Rick Hall owns a card shop, Hall's Cards. The following cash information is available for the month of August Year 1: As of August 31, the bank statement shows a balance of $12,985. The August 31 unadjusted balance in the Cash account of Hall's Cards is $8,491. A review of the bank statement revealed the following information: 1. A deposit of $1,190 on August 31, Year 1, does not appear on the August bank statement. 2. It was discovered that a check to pay for baseball cards was correctly written and paid by the bank for $2,805 but was recorded on the books as $3,705. 3. When checks written during the month were compared with those paid by the bank, three checks amounting to $4,810 were found to be outstanding. 4. A debit memo for $26 was included in the bank statement for the purchase of a new supply of checks. Required: Prepare a bank reconciliation at the end of August showing the true cash balance. Note: Negative amounts should be indicated with minus sign.
Rick Hall owns a card shop, Hall's Cards. The following cash information is available for the month of August Year 1: As of August 31, the bank statement shows a balance of $12,985. The August 31 unadjusted balance in the Cash account of Hall's Cards is $8,491. A review of the bank statement revealed the following information: 1. A deposit of $1,190 on August 31, Year 1, does not appear on the August bank statement. 2. It was discovered that a check to pay for baseball cards was correctly written and paid by the bank for $2,805 but was recorded on the books as $3,705. 3. When checks written during the month were compared with those paid by the bank, three checks amounting to $4,810 were found to be outstanding. 4. A debit memo for $26 was included in the bank statement for the purchase of a new supply of checks. Required: Prepare a bank reconciliation at the end of August showing the true cash balance. Note: Negative amounts should be indicated with minus sign.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:Problem 6-18A (Algo) Preparing a bank reconciliation LO 6-3
Rick Hall owns a card shop, Hall's Cards. The following cash information is available for the month of August Year 1:
As of August 31, the bank statement shows a balance of $12,985. The August 31 unadjusted balance in the Cash account of Hall's
Cards is $8,491. A review of the bank statement revealed the following information:
1. A deposit of $1,190 on August 31, Year 1, does not appear on the August bank statement.
2. It was discovered that a check to pay for baseball cards was correctly written and paid by the bank for $2,805 but was recorded on
the books as $3,705.
3. When checks written during the month were compared with those paid by the bank, three checks amounting to $4,810 were found
to be outstanding.
4. A debit memo for $26 was included in the bank statement for the purchase of a new supply of checks.
Required:
Prepare a bank reconciliation at the end of August showing the true cash balance.
Note: Negative amounts should be indicated with minus sign.
HALL'S CARDS
Bank Reconciliation
August 31, Year 1
Unadjusted Bank Balance, August 31, Year 1
True Cash Balance, August 31, Year 1
Unadjusted Book Balance, August 31, Year 1
True Cash Balance, August 31, Year 1
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