Santana Rey receives the March bank statement for Business Solutions on April 11, 2022. The March 31 bank statement shows an ending cash balance of $67,666. The general ledger Cash account, Number 101, shows an ending cash balance per books of $68,266 as of March 31 (prior to any reconciliation). A comparison of the bank statement with the general ledger Cash account, Number 101, reveals the following. a. The bank erroneously cleared a $600 check against the company account in March that S. Rey did not issue. The check was actually issued by Business Systems. b. On March 25, the bank statement lists a $57 charge for a safety deposit box. Santana has not yet recorded this expense. c. On March 26, the bank statement lists a $110 charge for printed checks that Business Solutions ordered from the bank. Santana has not yet recorded this expense. d. On March 31, the bank statement lists $36 interest earned on Business Solutions's checking account for the month of March. Santana has not yet recorded this revenue. e. S. Rey notices that the check she issued for $131 on March 31, 2022, has not yet cleared the bank. f. S. Rey verifies that all deposits made in March do appear on the March bank statement. Required: 1. Prepare a bank reconciliation for Business Solutions for the month ended March 31, 2022.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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### Bank Reconciliation Exercise for Business Solutions

**Scenario:**

Santana Rey received the March bank statement for Business Solutions on April 11, 2022. According to the March 31 bank statement, the ending cash balance is $67,666. However, the general ledger Cash account (Number 101) shows an ending cash balance of $68,266 as of March 31 (before any reconciliation).

**Reconciliation Details:**

A comparison of the bank statement with the general ledger reveals the following discrepancies:

a. The bank erroneously cleared a $600 check against the account in March that S. Rey did not issue. This check was actually used by Business Systems.

b. On March 25, the bank statement lists a $57 charge for a safety deposit box. Santana has not recorded this expense.

c. On March 26, the bank statement lists a $110 charge for printed checks ordered from the bank, which Santana has not yet recorded.

d. On March 31, the bank statement lists $36 interest earned on the Business Solutions's checking account that Santana has yet to record.

e. S. Rey notes a $131 check she issued on March 31, 2022, has not yet cleared the bank.

f. All deposits made in March do appear on the March bank statement.

**Task:**

1. Prepare a bank reconciliation for Business Solutions for the month ended March 31, 2022.

**Reconciliation Table:**

Below is the template for preparing the reconciliation:

- **BUSINESS SOLUTIONS**
  - **Bank Reconciliation**
  - **March 31, 2022**

| Bank Statement Balance | Book Balance |
|------------------------|--------------|
|                        |              |
| **Add:**               | **Add:**     |
|                        |              |
|                        |              |
| 0                      | 0            |

Prepare the reconciliation by identifying and correcting the discrepancies listed above.
Transcribed Image Text:### Bank Reconciliation Exercise for Business Solutions **Scenario:** Santana Rey received the March bank statement for Business Solutions on April 11, 2022. According to the March 31 bank statement, the ending cash balance is $67,666. However, the general ledger Cash account (Number 101) shows an ending cash balance of $68,266 as of March 31 (before any reconciliation). **Reconciliation Details:** A comparison of the bank statement with the general ledger reveals the following discrepancies: a. The bank erroneously cleared a $600 check against the account in March that S. Rey did not issue. This check was actually used by Business Systems. b. On March 25, the bank statement lists a $57 charge for a safety deposit box. Santana has not recorded this expense. c. On March 26, the bank statement lists a $110 charge for printed checks ordered from the bank, which Santana has not yet recorded. d. On March 31, the bank statement lists $36 interest earned on the Business Solutions's checking account that Santana has yet to record. e. S. Rey notes a $131 check she issued on March 31, 2022, has not yet cleared the bank. f. All deposits made in March do appear on the March bank statement. **Task:** 1. Prepare a bank reconciliation for Business Solutions for the month ended March 31, 2022. **Reconciliation Table:** Below is the template for preparing the reconciliation: - **BUSINESS SOLUTIONS** - **Bank Reconciliation** - **March 31, 2022** | Bank Statement Balance | Book Balance | |------------------------|--------------| | | | | **Add:** | **Add:** | | | | | | | | 0 | 0 | Prepare the reconciliation by identifying and correcting the discrepancies listed above.
**Bank Reconciliation Process for Business Solutions: March 31, 2022**

---

**Bank Statement Balance**  
- Enter bank statement balance here.

**Add:**

1. Enter any deposits in transit or other additions here.  
   - Amount: $0

**Deduct:**

1. Enter any outstanding checks or other deductions here.  
   - Amount: $0

**Adjusted Bank Balance:**  
- Calculated as the bank statement balance plus additions and minus deductions.  
  - Adjusted Balance: $0

---

**Book Balance**  
- Enter book balance here.

**Add:**

1. Enter any interest earned or other additions here.  
   - Amount: $0

**Deduct:**

1. Enter any bank fees or other deductions here.  
   - Amount: $0

**Adjusted Book Balance:**  
- Calculated as the book balance plus additions and minus deductions.  
  - Adjusted Balance: $0

---

**Diagram Explanation:**  
The table is divided into two main sections: Bank Statement Balance and Book Balance. Each section requires inputs for specific additions and deductions. The adjusted balances help in ensuring both bank and book records are reconciled accurately for the period ending March 31, 2022.
Transcribed Image Text:**Bank Reconciliation Process for Business Solutions: March 31, 2022** --- **Bank Statement Balance** - Enter bank statement balance here. **Add:** 1. Enter any deposits in transit or other additions here. - Amount: $0 **Deduct:** 1. Enter any outstanding checks or other deductions here. - Amount: $0 **Adjusted Bank Balance:** - Calculated as the bank statement balance plus additions and minus deductions. - Adjusted Balance: $0 --- **Book Balance** - Enter book balance here. **Add:** 1. Enter any interest earned or other additions here. - Amount: $0 **Deduct:** 1. Enter any bank fees or other deductions here. - Amount: $0 **Adjusted Book Balance:** - Calculated as the book balance plus additions and minus deductions. - Adjusted Balance: $0 --- **Diagram Explanation:** The table is divided into two main sections: Bank Statement Balance and Book Balance. Each section requires inputs for specific additions and deductions. The adjusted balances help in ensuring both bank and book records are reconciled accurately for the period ending March 31, 2022.
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