Part 2:Prepare a bank reconciliation for December.Part 3:1. Record the interest of $60 received from the bank.2. Record the service charges of $130 deducted by thebank.3. Record the return of the J. Left check of $280 dueto insufficient funds4. Record the checks outstanding at the end of themonth.5. Record the deposit in transit at the end of themonth.Part 4:After the reconciliation journal entries are posted,what balance will be reflected in the Cash account inthe ledger? If the company also has $280, of pettycash on hand, which is recorded in a differentaccount called Petty Cash on Hand, what totalamount of Cash and Cash Equivalents should bereported on the December 31 balance sheet? **PA5-3 (Algo) Identifying Outstanding Checks and Deposits in Transit and Preparing a Bank Reconciliation and Journal Entries [LO 5-4, LO 5-5]***[The following information applies to the questions displayed below.]*The December bank statement and cash T-account for Stewart Company follow:### BANK STATEMENT| Date | Checks | Deposits | Other | Balance ||-------------|----------|-----------|-------------------------------------|----------|| December 1 | | | | $45,600 || December 6 | $7,600 | | | 38,000 || December 11 | $530 | $27,000 | | 64,470 || December 17 | $12,900 | | | 51,570 || December 23 | | $35,000 | | 86,570 || December 26 | $530 | | | 86,040 || December 30 | $17,800 | $18,000 | NSF* | || | | | $280 | || December 31 | | | Interest earned | $60 | 86,020 || | | | Service charge | $130 | 85,890 |*NSF check from J. Left, a customer.### Cash (A) T-Account| Date | Debit | Credit ||-------------|-----------|---------------------------------|| December 1 | Balance | 45,600 || Deposits | December 11 | 27,000 || | December 23 | 35,000 || | December 30 | 18,000 || | December 31 | 12,000 || | | **Checks written during December** || | | December 6 | $7,600 || | | December 11 | $530 || | | December 17 | $12,900 || | | December 26 | $530 || | | December 30 | $17,800 || | | December

The bank reconciliation statement is prepared to equate the balances of cash book and passbook with…

Answered: Part 2: Prepare a bank reconciliation…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Part 2: Prepare a bank reconciliation for December. Part 3: 1. Record the interest of $60 received from the bank. 2. Record the service charges of $130 deducted by the bank. 3. Record the return of the J. Left check of $280 due to insufficient funds 4. Record the checks outstanding at the end of the month. 5. Record the deposit in transit at the end of the month. Part 4: After the reconciliation journal entries are posted, what balance will be reflected in the Cash account in the ledger? If the company also has $280, of petty cash on hand, which is recorded in a different account called Petty Cash on Hand, what total amount of Cash and Cash Equivalents should be reported on the December 31 balance sheet?

**PA5-3 (Algo) Identifying Outstanding Checks and Deposits in Transit and Preparing a Bank Reconciliation and Journal Entries [LO 5-4, LO 5-5]**

*[The following information applies to the questions displayed below.]*

The December bank statement and cash T-account for Stewart Company follow:

### BANK STATEMENT

| Date | Checks | Deposits | Other | Balance |
|-------------|----------|-----------|-------------------------------------|----------|
| December 1 | | | | $45,600 |
| December 6 | $7,600 | | | 38,000 |
| December 11 | $530 | $27,000 | | 64,470 |
| December 17 | $12,900 | | | 51,570 |
| December 23 | | $35,000 | | 86,570 |
| December 26 | $530 | | | 86,040 |
| December 30 | $17,800 | $18,000 | NSF* | |
| | | | $280 | |
| December 31 | | | Interest earned | $60 | 86,020 |
| | | | Service charge | $130 | 85,890 |

*NSF check from J. Left, a customer.

### Cash (A) T-Account

| Date | Debit | Credit |
|-------------|-----------|---------------------------------|
| December 1 | Balance | 45,600 |
| Deposits | December 11 | 27,000 |
| | December 23 | 35,000 |
| | December 30 | 18,000 |
| | December 31 | 12,000 |
| | | **Checks written during December** |
| | | December 6 | $7,600 |
| | | December 11 | $530 |
| | | December 17 | $12,900 |
| | | December 26 | $530 |
| | | December 30 | $17,800 |
| | | December

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