You are the bookkeeper of Mel Traders. You undertake a bank reconciliation at the end of every month. Mel Traders received its bank statement for the month ending 31 May 2021. The bank reconciliation at the end of April showed a deposit in transit of $11,700 and two outstanding cheques (no. 663 for $3,060 and no. 671 for $6,300). The adjusted cash balance in the entity’s records was $106,305 debit at the end of April.Below are the entity’s May bank statement and the entity’s book records that indicate the deposits made and cheques written during the month of May:AU Bank - Bank StatementFor the period 01/05/2021 – 31/05/2021Mel Traders DrCrBalance $ Balance brought forward 103,965CR1MayDeposit 11,700115,665CR3MayDeposit 10,620126,285CR MayCheque # 6824,680 121,605CR6MayDeposit 6,120127,725CR8May# 6716,300 121,425CR9MayDeposit 7,560128,985CR12MayDeposit 3,780132,765CR May# 6846,300 126,465CR13May# 68315,300 111,165CR15MayDeposit 14,580125,745CR May# 68713,320 112,425CR20MayDeposit 5,040117,465CR22May# 68512,240 105,225CR26MayDeposit 13,680118,905CR29May# 68611,340 107,565CR30May# 6807,740 99,825CR31Mayinterest 345100,170CR31MayTransaction fees195 99,975CRMel Traders’ Book RecordsDateDeposits madeCheques written $No.$May310620# 6794320 66120# 6807740 97560# 6816210 123780# 6824680 1514580# 68315300 205040# 6846300 2613680# 68512240 2911340# 6866480 $ 72,720# 68713320 $ 76,590The cash at bank account balance on 31 May was $102,435.In reviewing cheques, a mistake was discovered: Cheque no. 686, written for insurance expenses of $11,340, was recorded in the general journal as $6,480.Required:As the entity does not use special journals, prepare the necessary general journal entries to bring the cash at bank account up to date as at 31 May 2021.Prepare a bank reconciliation statement for Mel Traders at 31 May 2021. Please ensure you indicate the balance of each amount with either a debit or credit in the bank reconciliation statement.

1) Journal Entries: S no Accounts and explanation Debit Credit (i) Cash 10530…

Answered: ived its bank statement for the month…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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You are the bookkeeper of Mel Traders. You undertake a bank reconciliation at the end of every month. Mel Traders received its bank statement for the month ending 31 May 2021. The bank reconciliation at the end of April showed a deposit in transit of $11,700 and two outstanding cheques (no. 663 for $3,060 and no. 671 for $6,300). The adjusted cash balance in the entity’s records was $106,305 debit at the end of April.

Below are the entity’s May bank statement and the entity’s book records that indicate the deposits made and cheques written during the month of May:

AU Bank - Bank Statement For the period 01/05/2021 – 31/05/2021 Mel Traders
			Dr	Cr	Balance $
		Balance brought forward			103,965	CR
1	May	Deposit		11,700	115,665	CR
3	May	Deposit		10,620	126,285	CR
	May	Cheque # 682	4,680		121,605	CR
6	May	Deposit		6,120	127,725	CR
8	May	# 671	6,300		121,425	CR
9	May	Deposit		7,560	128,985	CR
12	May	Deposit		3,780	132,765	CR
	May	# 684	6,300		126,465	CR
13	May	# 683	15,300		111,165	CR
15	May	Deposit		14,580	125,745	CR
	May	# 687	13,320		112,425	CR
20	May	Deposit		5,040	117,465	CR
22	May	# 685	12,240		105,225	CR
26	May	Deposit		13,680	118,905	CR
29	May	# 686	11,340		107,565	CR
30	May	# 680	7,740		99,825	CR
31	May	interest		345	100,170	CR
31	May	Transaction fees	195		99,975	CR

Mel Traders’ Book Records
Date	Deposits made	Cheques written
		$	No.	$
May	3	10620	# 679	4320
	6	6120	# 680	7740
	9	7560	# 681	6210
	12	3780	# 682	4680
	15	14580	# 683	15300
	20	5040	# 684	6300
	26	13680	# 685	12240
	29	11340	# 686	6480
		$ 72,720	# 687	13320
				$ 76,590

The cash at bank account balance on 31 May was $102,435.

In reviewing cheques, a mistake was discovered: Cheque no. 686, written for insurance expenses of $11,340, was recorded in the general journal as $6,480.

Required:

As the entity does not use special journals, prepare the necessary general journal entries to bring the cash at bank account up to date as at 31 May 2021.
Prepare a bank reconciliation statement for Mel Traders at 31 May 2021. Please ensure you indicate the balance of each amount with either a debit or credit in the bank reconciliation statement.

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