On October 31, 2021, the bank statement for the checking account of Blockwood Video shows a balance of $12,660, while the company’s records show a balance of $12,306. Information that might be useful in preparing a bank reconciliation is as follows: Outstanding checks are $1,205. The October 31 cash receipts of $760 are not deposited in the bank until November 2. One check written in payment of utilities for $132 is correctly recorded by the bank but is recorded by Blockwood as a disbursement of $213. In accordance with prior authorization, the bank withdraws $645 directly from the checking account as payment on a note payable. The interest portion of that payment is $45 and the principal portion is $600. Blockwood has not recorded the direct withdrawal. Bank service fees of $19 are listed on the bank statement. A deposit of $562 is recorded by the bank on October 13, but it did not belong to Blockwood. The deposit should have been made to the checking account of Hollybuster Video, a separate company. The bank statement includes a charge of $70 for an NSF check. The check is returned with the bank statement, and the company will seek payment from the customer. Required: 1. Prepare a bank reconciliation for the Blockwood checking account on October 31, 2021. (Amounts to be deducted should be indicated with a minus sign.)

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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On October 31, 2021, the bank statement for the checking account of Blockwood Video shows a balance of $12,660, while the company’s records show a balance of $12,306. Information that might be useful in preparing a bank reconciliation is as follows:

Outstanding checks are $1,205.
The October 31 cash receipts of $760 are not deposited in the bank until November 2.
One check written in payment of utilities for $132 is correctly recorded by the bank but is recorded by Blockwood as a disbursement of $213.
In accordance with prior authorization, the bank withdraws $645 directly from the checking account as payment on a note payable. The interest portion of that payment is $45 and the principal portion is $600. Blockwood has not recorded the direct withdrawal.
Bank service fees of $19 are listed on the bank statement.
A deposit of $562 is recorded by the bank on October 13, but it did not belong to Blockwood. The deposit should have been made to the checking account of Hollybuster Video, a separate company.
The bank statement includes a charge of $70 for an NSF check. The check is returned with the bank statement, and the company will seek payment from the customer.

Required:

1. Prepare a bank reconciliation for the Blockwood checking account on October 31, 2021. (Amounts to be deducted should be indicated with a minus sign.)

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