The following information is available to reconcile Wild Willy’s White wash Co. After all posting is complete on July 31,2002, the company’s Cash account has a $13,805 debit balance, but its bank statement shows a $14,350 balance.Checks outstanding total $4,180.In comparing the canceled checks returned by the bank with the entries in the accounting records, it is found that Check No. 2222 for July phone bill was correctly written and drawn for $720 but was erroneously entered in the accounting records as $270.The bank charged Wild Willy’s $40 for a safe-deposit box. Wild Willy’s does not have a safe-deposit box.A debit memorandum for $125 lists a $100 NSF check plus a $25 NSF charge. The check had been received from the Public Trust bank. Wild Willy has not yet recorded this check as NSF.Enclosed with the statement is a $20 debit memorandum for bank services. It has not yet been recorded because no previous notification had been received.The July 31 daily cash receipts of $3,000 were placed in the bank’s night depository on that date but do not appear on the July 31 bank statement.Required: Prepare a bank reconciliation and adjusting entries for this company as of July 31, 2002.

Balance as per cash account $13,805 Deduction: NSF Check $125 Service charges $20 Safe deposit…

Answered: Prepare a bank reconciliation and…

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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The following information is available to reconcile Wild Willy’s White wash Co.

After all posting is complete on July 31,2002, the company’s Cash account has a $13,805 debit balance, but its bank statement shows a $14,350 balance.
Checks outstanding total $4,180.
In comparing the canceled checks returned by the bank with the entries in the accounting records, it is found that Check No. 2222 for July phone bill was correctly written and drawn for $720 but was erroneously entered in the accounting records as $270.
The bank charged Wild Willy’s $40 for a safe-deposit box. Wild Willy’s does not have a safe-deposit box.
A debit memorandum for $125 lists a $100 NSF check plus a $25 NSF charge. The check had been received from the Public Trust bank. Wild Willy has not yet recorded this check as NSF.
Enclosed with the statement is a $20 debit memorandum for bank services. It has not yet been recorded because no previous notification had been received.
The July 31 daily cash receipts of $3,000 were placed in the bank’s night depository on that date but do not appear on the July 31 bank statement.

Required: Prepare a bank reconciliation and adjusting entries for this company as of July 31, 2002.

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