Stewart Recording Studio, owned by Ron Stewart, showed the following bank reconciliation at March 31: Stewart Recording Studio Bank Reconciliation March 31, 2020 Bank statement balance $ 22,200 Book balance $ 31,085 Add: Deposit of March 31 in transit 10,045 $ 32,245 Deduct: Outstanding cheques: #14 $ 843 #22 317 1,160 Adjusted bank balance $ 31,085 Adjusted book balance $ 31,085 Cash Acct. No. 101 Date Explanation PR Debit Credit Balance 2020 March 31 Balance 31,085 April 30 CR17 71,762 102,847 30 CD13 92,000 10,847 A list of deposits made and cheques written during April, taken from the Cash Receipts Journal and Cash Disbursements Journal, is shown below: Deposits Made April 7 $ 693 13 4,620 18 5,926 23 13,961 27 1,758 30 44,804 Total April Cash Receipts $ 71,762 Cheques Written No. 23 $ 5,223 24 3,164 25 944 26 313 27 4,271 28 4,900 29 19,818 30 41,440 31 416 32 11,511 Total April Cash Disbursements $ 92,000 The following bank statement is available for April: Bank Statement To: Stewart Recording Studio April 30, 2020 Bank of Canada Cheques/Charges Deposits/Credits Balance 22,200 #31 04/03 416 04/03 10,045 31,829 #28 04/07 9,400 04/07 693 23,122 #26 04/13 313 04/13 4,620 27,429 NSF 04/18 14,337 04/18 5,926 19,018 #24 04/23 3,164 04/23 13,961 29,815 #23 04/27 5,223 04/27 1,758 26,350 #29 04/30 19,818 04/30 121,000 127,532 PMT 04/30 16,052 111,480 INT 04/30 498 110,982 SC 04/30 177 110,805 NSF = Not Sufficient Funds SC = Service Charge PMT = Payment of Principal on the loan INT = Interest on Bank Loan In reviewing cheques returned by the bank, the bookkeeper discovered that cheque #28, for delivery expense, was recorded in the Cash Disbursements Journal correctly as $4,900. The NSF cheque for $14,337 was that of customer Oprah Winney, deposited in March. On the bank statement, the payment for $16,052 is regarding a note payable. There is also a deposit of $121,000 dated April 30. It is an investment made by the owner into the business (the bank transferred the funds electronically from the owner’s personal account to his business account, which is why it was not recorded in the Cash Receipts Journal). 1. Record to reinstate customer account (April 30) 2. Record the April Bank service charges (April 30) 3. Record the April Interest expense (April 30) Image attached for reference

Stewart Recording Studio, owned by Ron Stewart, showed the following bank reconciliation at March 31: Stewart Recording Studio Bank Reconciliation March 31, 2020 Bank statement balance $ 22,200 Book balance $ 31,085 Add: Deposit of March 31 in transit 10,045 $ 32,245 Deduct: Outstanding cheques: #14 $ 843 #22 317 1,160 Adjusted bank balance $ 31,085 Adjusted book balance $ 31,085 Cash Acct. No. 101 Date Explanation PR Debit Credit Balance 2020 March 31 Balance 31,085 April 30 CR17 71,762 102,847 30 CD13 92,000 10,847 A list of deposits made and cheques written during April, taken from the Cash Receipts Journal and Cash Disbursements Journal, is shown below: Deposits Made April 7 $ 693 13 4,620 18 5,926 23 13,961 27 1,758 30 44,804 Total April Cash Receipts $ 71,762 Cheques Written No. 23 $ 5,223 24 3,164 25 944 26 313 27 4,271 28 4,900 29 19,818 30 41,440 31 416 32 11,511 Total April Cash Disbursements $ 92,000 The following bank statement is available for April: Bank Statement To: Stewart Recording Studio April 30, 2020 Bank of Canada Cheques/Charges Deposits/Credits Balance 22,200 #31 04/03 416 04/03 10,045 31,829 #28 04/07 9,400 04/07 693 23,122 #26 04/13 313 04/13 4,620 27,429 NSF 04/18 14,337 04/18 5,926 19,018 #24 04/23 3,164 04/23 13,961 29,815 #23 04/27 5,223 04/27 1,758 26,350 #29 04/30 19,818 04/30 121,000 127,532 PMT 04/30 16,052 111,480 INT 04/30 498 110,982 SC 04/30 177 110,805 NSF = Not Sufficient Funds SC = Service Charge PMT = Payment of Principal on the loan INT = Interest on Bank Loan In reviewing cheques returned by the bank, the bookkeeper discovered that cheque #28, for delivery expense, was recorded in the Cash Disbursements Journal correctly as $4,900. The NSF cheque for $14,337 was that of customer Oprah Winney, deposited in March. On the bank statement, the payment for $16,052 is regarding a note payable. There is also a deposit of $121,000 dated April 30. It is an investment made by the owner into the business (the bank transferred the funds electronically from the owner’s personal account to his business account, which is why it was not recorded in the Cash Receipts Journal). 1. Record to reinstate customer account (April 30) 2. Record the April Bank service charges (April 30) 3. Record the April Interest expense (April 30) Image attached for reference

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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Stewart Recording Studio, owned by Ron Stewart, showed the following bank reconciliation at March 31:

Stewart Recording Studio
Bank Reconciliation
March 31, 2020
Bank statement balance			$	22,200	Book balance	$	31,085
Add:
Deposit of March 31 in transit				10,045
			$	32,245
Deduct:
Outstanding cheques:
#14	$	843
#22		317		1,160
Adjusted bank balance			$	31,085	Adjusted book balance	$	31,085

Cash	Acct. No. 101
Date		Explanation	PR	Debit		Credit	Balance
2020
March	31		Balance					31,085
April	30			CR17	71,762			102,847
	30			CD13			92,000	10,847

A list of deposits made and cheques written during April, taken from the Cash Receipts Journal and Cash Disbursements Journal, is shown below:

Deposits Made
April	7		$	693
	13			4,620
	18			5,926
	23			13,961
	27			1,758
	30			44,804
Total April Cash Receipts	$	71,762

Cheques Written
No.	23		$	5,223
	24			3,164
	25			944
	26			313
	27			4,271
	28			4,900
	29			19,818
	30			41,440
	31			416
	32			11,511
Total April Cash Disbursements	$	92,000

The following bank statement is available for April:

Bank Statement
To: Stewart Recording Studio		April 30, 2020 Bank of Canada
Cheques/Charges		Deposits/Credits		Balance
								22,200
#31	04/03		416			04/03	10,045	31,829
#28	04/07		9,400			04/07	693	23,122
#26	04/13		313			04/13	4,620	27,429
NSF	04/18		14,337			04/18	5,926	19,018
#24	04/23		3,164			04/23	13,961	29,815
#23	04/27		5,223			04/27	1,758	26,350
#29	04/30		19,818			04/30	121,000	127,532
PMT	04/30		16,052					111,480
INT	04/30		498					110,982
SC	04/30		177					110,805
NSF = Not Sufficient Funds	SC = Service Charge		PMT = Payment of Principal on the loan		INT = Interest on Bank Loan

In reviewing cheques returned by the bank, the bookkeeper discovered that cheque #28, for delivery expense, was recorded in the Cash Disbursements Journal correctly as $4,900.
The NSF cheque for $14,337 was that of customer Oprah Winney, deposited in March.
On the bank statement, the payment for $16,052 is regarding a note payable.
There is also a deposit of $121,000 dated April 30. It is an investment made by the owner into the business (the bank transferred the funds electronically from the owner’s personal account to his business account, which is why it was not recorded in the Cash Receipts Journal).

1. Record to reinstate customer account (April 30)

2. Record the April Bank service charges (April 30)

3. Record the April Interest expense (April 30)

Image attached for reference

Date
General Journal
Debit
Credit
Apr 30

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