# Bank Reconciliation Exercise## IntroductionBob's Vitamins has just completed its first month of business. Bob needs to reconcile his first bank statement with his cash account. The bank statement, issued by Sparta Community Bank, and Bob's Cash Account summary are provided below.### ObjectiveLearn how to reconcile a bank statement by comparing it with a cash account, adjusting for transactions not yet recorded by the bank or the business.---### Bank Statement**Sparta Community Bank**123 East Main Street Sparta, Illinois**Bob’s Vitamins** 223 West Market Street Sparta, Illinois**Business Account**: 03-4538245| Balance | | | ||-------------------------|----------|--------|--------------|| Last Statement | Deposits | Withdrawals | This Statement || 10,000 | 10,856 | 6808 | 14,048 |#### Deposits/Credits- **3-Mar**: 1685- **10-Mar**: 2465- **17-Mar**: 2899- **20-Mar**: 325 (Direct Deposit)- **31-Mar**: 32 (Interest Paid)#### Checks- **1001**: 25- **1002**: 200- **1003**: 38- **1004**: 4560- **1005**: 200- **1006**: 56- **1007**: 526- **1008**: 1500- **1009**: 200- **1010**: 200- **1011**: 24#### Other Withdrawals/Debits- NSF Check: 43---### Cash Account Summary**Bob’s Vitamins****Cash Account Summary for March**- March 1 Balance: 10,000- March Deposits: 13,152- March Checks: (7,729)- March 31 Balance: 15,423#### Details| Date | Description | Amount ||--------|-------------|--------|| **3-Mar** | Deposit | 1685 || | Check 1001 | 25 || | Check 1002 | 200 || | Check 1003 | **Fill in the Blank****Bob's Vitamins**Reconciliation of bank and book balance at March 31, 20XX---**Bank Balance**- **Ending Balance, March 31**: $_____ - **Additions**: - Deposit in transit: $_____ - **Subtraction**: - Checks outstanding: ($_____) - **Total**: $_____**Correct cash balance**: $15_____---**Book Balance**- **Ending book balance, March 31**: $_____ - **Additions**: - Direct deposit: $_____ - Interest earned: $_____ - **Subtractions**: - NSF check returned: ($_____) - **Total**: $_____**Correct cash balance**: $15_____---The form above is used for reconciling the differences between the bank's balance and the company's book balance as of a specific date. Each section allows for adjustments based on transactions that may not have been recorded by either the bank or the company at the time. The objective is to determine the correct cash balance, which, in this example, is partially filled as $15___, indicating a need for further calculation or information.

Bob's Vitamins has just completed its first month of business and Bob has received his first bank statement and needs to reconcile it. Below are the bank statement and Bob's Cash Account, along with the details that went into creating the cash account. Can you help him reconcile the two? Hint: The process of reconciling bank balance and book balance is quite simple. Add (subtract) to the bank balance those things that you know about account that the bank does not know Add (Subtract) to your book balance those things that the bank knows about your account that you do not know until reported by the bank. Sparta Community Bank 123 East Main Street Sparta, Illinois Bob's Vitamins 223 West Market Street Sparta, Illinois BUSINESS ACCOUNT 03-4538245 Balance Withdrawal Balance This Statement The Month of March, 20 March 1 Balance March Deposits March Checks March 31 Balance Details 3-Mar Deposit Check 1001 Check 1002 Check 1003 10-Mar Deposit . Check 1004 Check 1005 25 200 38 4560 200 10,000 13,152 (7,729) 15,423 1685 2465

Bob's Vitamins has just completed its first month of business and Bob has received his first bank statement and needs to reconcile it. Below are the bank statement and Bob's Cash Account, along with the details that went into creating the cash account. Can you help him reconcile the two? Hint: The process of reconciling bank balance and book balance is quite simple. Add (subtract) to the bank balance those things that you know about account that the bank does not know Add (Subtract) to your book balance those things that the bank knows about your account that you do not know until reported by the bank. Sparta Community Bank 123 East Main Street Sparta, Illinois Bob's Vitamins 223 West Market Street Sparta, Illinois BUSINESS ACCOUNT 03-4538245 Balance Withdrawal Balance This Statement The Month of March, 20 March 1 Balance March Deposits March Checks March 31 Balance Details 3-Mar Deposit Check 1001 Check 1002 Check 1003 10-Mar Deposit . Check 1004 Check 1005 25 200 38 4560 200 10,000 13,152 (7,729) 15,423 1685 2465

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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How do I solve for problem 1?
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