On September 30 the bank statement of Fine Company showed a balance of $11,650. The following information was revealed by comparing the bank statement to the cash balance in Fine's accounting records: • Deposits in transit amounted to $4,815 • Outstanding checks amounted to $8,790 . $720 check was incorrectly drawn on Fine's account • NSF checks urned by the bank were $1,140 • The bank service charge was $41 • Credit memo for $160 for the collection of one of the company's account receivable What is the true cash balance? Multiple Choice OOO O $9,209 $8,395 $7,374 $8,514

On September 30 the bank statement of Fine Company showed a balance of $11,650. The following information was revealed by comparing the bank statement to the cash balance in Fine's accounting records: • Deposits in transit amounted to $4,815 • Outstanding checks amounted to $8,790 . $720 check was incorrectly drawn on Fine's account • NSF checks urned by the bank were $1,140 • The bank service charge was $41 • Credit memo for $160 for the collection of one of the company's account receivable What is the true cash balance? Multiple Choice OOO O $9,209 $8,395 $7,374 $8,514

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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A check for $2,560 to pay a vendor on account was recorded in the firm's records as $2,650; the canceled check was properly listed on the bank statement at $2,560. To arrive at an accurate balance on a bank reconciliation statement:
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The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6: Cash balance according to the company’s records at August 31, $42,920. Cash balance according to the bank statement at August 31, $56,300. Checks outstanding, $25,390. Deposit in transit not recorded by bank, $13,325. A check for $150 in payment of an account was erroneously recorded in the check register as $1,500. Bank debit memo for service charges, $35. Journalize the entries that should be made by the company that (a) increase cash and (b) decrease cash. If an amount box does not require an entry, leave it blank.
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. A company's bank statement shows a balance of $10,000, while its cash account in the company's records indicates a balance of $9,500. Upon further analysis, the following discrepancies are identified: Outstanding checks total $1,200. • The bank erroneously recorded a deposit of $500 as $50. • The company recorded a check for $800 as $80. • The bank charged a service fee of $25. Calculate the adjusted cash balance after reconciling these discrepancies. Remember to subtract any outstanding checks and bank errors, and add any unrecorded deposits or adjustments to the cash balance to arrive at the adjusted cash balance.
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.
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