Bank reconciliation and entriesThe cash account for Pala Medical Co. at June 30, 20Y1, indicated abalance of $166,436. The bank statement indicated a balance of $195,688on June 30, 20Y1. Comparing the bank statement and the accompanyingcanceled checks and memos with the records revealed the followingreconciling items:A. Checks outstanding totaled $19,427.B. A deposit of $12,300, representing receipts of June 30, had beenmade too late to appear on the bank statement.C. The bank collected $26,500 on a $25,000 note, including interestof $1,500. D. A check for $4,000 returned with the statement had been incorrectly recorded by Pala Medical Co. as $400. Thecheck was for the payment of an obligation to Skyline Supply Co. for a purchase on account.E. A check drawn for $195 had been erroneously charged by the bank as $915.F. Bank service charges for June amounted to $55.Instructions1. Prepare a bank reconciliation.2. Journalize the necessary entries.3. If a balance sheet were prepared for Pala Medical Co. on June 30, 20Y1, what amount should be reported as cash?
Bank reconciliation and entries
The cash account for Pala Medical Co. at June 30, 20Y1, indicated a
balance of $166,436. The bank statement indicated a balance of $195,688
on June 30, 20Y1. Comparing the bank statement and the accompanying
canceled checks and memos with the records revealed the following
reconciling items:
A. Checks outstanding totaled $19,427.
B. A deposit of $12,300, representing receipts of June 30, had been
made too late to appear on the bank statement.
C. The bank collected $26,500 on a $25,000 note, including interest
of $1,500.
D. A check for $4,000 returned with the statement had been incorrectly recorded by Pala Medical Co. as $400. The
check was for the payment of an obligation to Skyline Supply Co. for a purchase on account.
E. A check drawn for $195 had been erroneously charged by the bank as $915.
F. Bank service charges for June amounted to $55.
Instructions
1. Prepare a bank reconciliation.
2. Journalize the necessary entries.
3. If a balance sheet were prepared for Pala Medical Co. on June 30, 20Y1, what amount should be reported as cash?
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