The following information is available to reconcile Severino Co.’s book balance of cash with its bank statement cash balance as of December 31. a. The December 31 cash balance according to the accounting records is $32,878.30, and the bank statement cash balance for that date is $46,822.40. b. Check No. 1242 for $410.40, Check No. 1273 for $4,589.30, and Check No. 1282 for $400 are outstanding checks as of December 31. c. Check No. 1267 had been correctly drawn for $3,456 to pay for office supplies but was erroneously entered in the accounting records as $3,465. d. The bank statement shows a $762.50 NSF check received from a customer, Titus Industries, in payment of its account. The statement also shows a $99 bank fee in miscellaneous expenses for check printing. Severino had not yet recorded these transactions. e. The bank statement shows that the bank collected $18,980 cash on a note receivable for the company. Severino did not record this transaction before receiving the statement. f. Severino’s December 31 daily cash receipts of $9,583.10 were placed in the bank’s night depository on that date but do not appear on the December 31 bank statement. Required 1. Prepare the bank reconciliation for this company as of December 31. 2. Prepare the journal entries necessary to make the company’s book balance of cash equal to the reconciled cash balance as of December 31.
The following information is available to reconcile Severino Co.’s book balance of cash with its bank
statement cash balance as of December 31.
a. The December 31 cash balance according to the accounting records is $32,878.30, and the bank statement
cash balance for that date is $46,822.40.
b. Check No. 1242 for $410.40, Check No. 1273 for $4,589.30, and Check No. 1282 for $400 are outstanding
checks as of December 31.
c. Check No. 1267 had been correctly drawn for $3,456 to pay for office supplies but was erroneously
entered in the accounting records as $3,465.
d. The bank statement shows a $762.50 NSF check received from a customer, Titus Industries, in payment
of its account. The statement also shows a $99 bank fee in miscellaneous expenses for check
printing. Severino had not yet recorded these transactions.
e. The bank statement shows that the bank collected $18,980 cash on a note receivable for the company.
Severino did not record this transaction before receiving the statement.
f. Severino’s December 31 daily cash receipts of $9,583.10 were placed in the bank’s night depository
on that date but do not appear on the December 31 bank statement.
Required
1. Prepare the bank reconciliation for this company as of December 31.
2. Prepare the
cash balance as of December 31.
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