cash account for American Medical Co. at April 30 indicated a balance of $14,350. The bank statement indicated a balance of $16,340 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items: Checks outstanding totaled $5,880. A deposit of $6,130, representing receipts of April 30, had been made too late to appear on the bank statement. The bank collected $3,190 on a $3,020 note, including interest of $170. A check for $880 returned with the statement had been incorrectly recorded by American Medical Co. as $800. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account. A check drawn for $90 had been erroneously charged by the bank as $900. Bank service charges for April amounted to $60.
cash account for American Medical Co. at April 30 indicated a balance of $14,350. The bank statement indicated a balance of $16,340 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items: Checks outstanding totaled $5,880. A deposit of $6,130, representing receipts of April 30, had been made too late to appear on the bank statement. The bank collected $3,190 on a $3,020 note, including interest of $170. A check for $880 returned with the statement had been incorrectly recorded by American Medical Co. as $800. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account. A check drawn for $90 had been erroneously charged by the bank as $900. Bank service charges for April amounted to $60.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The cash account for American Medical Co. at April 30 indicated a balance of $14,350. The bank statement indicated a balance of $16,340 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:
- Checks outstanding totaled $5,880.
- A deposit of $6,130, representing receipts of April 30, had been made too late to appear on the bank statement.
- The bank collected $3,190 on a $3,020 note, including interest of $170.
- A check for $880 returned with the statement had been incorrectly recorded by American Medical Co. as $800. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account.
- A check drawn for $90 had been erroneously charged by the bank as $900.
- Bank service charges for April amounted to $60.
Required:
1. Prepare a bank reconciliation.
Expert Solution
Step 1
Bank reconciliation statement reconciles the cash balance of the bank with the cash balance of the company
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