Bank Reconciliation and EntriesThe cash account for Brentwood Bike Co. at May 1 indicated a balance of $14,890. During May, the total cash deposited was $75,970 and checks written totaled $70,540. The bank statement indicated a balance of $25,750 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items:Checks outstanding totaled $11,470.A deposit of $9,340, representing receipts of May 31, had been made too late to appear on the bank statement.The bank had collected for Brentwood Bike Co. $4,940 on a note left for collection. The face of the note was $4,560.A check for $360 returned with the statement had been incorrectly charged by the bank as $630.A check for $970 returned with the statement had been recorded by Brentwood Bike Co. as $790. The check was for the payment of an obligation to Adkins Co. on account.Bank service charges for May amounted to $50.A check for $1,140 from Jennings Co. was returned by the bank because of insufficient funds.Instructions:1. Prepare a bank reconciliation as of May 31.Brentwood Bike Co.Bank ReconciliationMay 31Cash balance according to bank statement $fill in the blank 11a54af71fa5ff7_1 $fill in the blank 11a54af71fa5ff7_3 fill in the blank 11a54af71fa5ff7_5fill in the blank 11a54af71fa5ff7_6 $fill in the blank 11a54af71fa5ff7_7 fill in the blank 11a54af71fa5ff7_9Adjusted balance $fill in the blank 11a54af71fa5ff7_10Cash balance according to company's records $fill in the blank 11a54af71fa5ff7_11 fill in the blank 11a54af71fa5ff7_13 $fill in the blank 11a54af71fa5ff7_14 $fill in the blank 11a54af71fa5ff7_16 fill in the blank 11a54af71fa5ff7_18 fill in the blank 11a54af71fa5ff7_20fill in the blank 11a54af71fa5ff7_21Adjusted balance $fill in the blank 11a54af71fa5ff7_222. Journalize the necessary entries (a.) that increase cash and (b.) that decrease cash. The accounts have not been closed. For a compound transaction, if an amount box does not require an entry, leave it blank.a. May 31 fill in the blank d99a3302d04c06f_2fill in the blank d99a3302d04c06f_3 fill in the blank d99a3302d04c06f_5fill in the blank d99a3302d04c06f_6 fill in the blank d99a3302d04c06f_8fill in the blank d99a3302d04c06f_9b. May 31 fill in the blank d99a3302d04c06f_11fill in the blank d99a3302d04c06f_12 fill in the blank d99a3302d04c06f_14fill in the blank d99a3302d04c06f_15 fill in the blank d99a3302d04c06f_17fill in the blank d99a3302d04c06f_18 fill in the blank d99a3302d04c06f_20fill in the blank d99a3302d04c06f_213. If a balance sheet is prepared for Brentwood Bike Co. on May 31, what amount should be reported as cash?$fill in the blank 7f9a6a03c078018_1

Bank reconciliation statement is the statement which states the summary of the business and banking activity that reconcile the bank account of the entity with the financial records or statements of the company. This statement shows the withdrawls, deposits as well as other activities that affect the bank account.1. Brentwood Bike Co. Bank Reconciliation For the month ended on May-31 Cash balance according to Bank Statement $25,750 Add: Deposit of May 31, not recorded by Bank $9,340 Add: Bank error in charging check as $630 instead of $360 $270 $9,610 $35,360 Subtract: Checks Outstanding $11,470 Adjusted Balance $23,890 Cash balance according to Company's books (14,890+75,970-70,540) $20,320 Add: Note collected by Bank (Including Interest) $4,940 $25,260 Subtract: Company's error in charging check as $790 instead of $970 $180 Subtract: Bank Service Charges $50 Subtract: Insufficient Fund Check $1,140 $1,370 Adjusted Balance $23,890 2. Journal entries are as follows: Date Particulars Debit Credit 31 May Cash Note Receivable Interest Revenue (Being recorded increase in cash as note collected) $4,940 $4,560 $380 31 May Accounts Payable Bank Service Charge Accounts receivable Cash (Being decrease in cash is recorded) $180 $50 $1,140 $1,370 3. Cash amount to be reported in the balance sheet on May 31 is $23,890

Answered: The cash account for Brentwood Bike Co.…

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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Bank Reconciliation and Entries

The cash account for Brentwood Bike Co. at May 1 indicated a balance of $14,890. During May, the total cash deposited was $75,970 and checks written totaled $70,540. The bank statement indicated a balance of $25,750 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items:

Checks outstanding totaled $11,470.
A deposit of $9,340, representing receipts of May 31, had been made too late to appear on the bank statement.
The bank had collected for Brentwood Bike Co. $4,940 on a note left for collection. The face of the note was $4,560.
A check for $360 returned with the statement had been incorrectly charged by the bank as $630.
A check for $970 returned with the statement had been recorded by Brentwood Bike Co. as $790. The check was for the payment of an obligation to Adkins Co. on account.
Bank service charges for May amounted to $50.
A check for $1,140 from Jennings Co. was returned by the bank because of insufficient funds.

Instructions:

1. Prepare a bank reconciliation as of May 31.

Brentwood Bike Co.
Bank Reconciliation
May 31
Cash balance according to bank statement		$fill in the blank 11a54af71fa5ff7_1
	$fill in the blank 11a54af71fa5ff7_3
	fill in the blank 11a54af71fa5ff7_5	fill in the blank 11a54af71fa5ff7_6
		$fill in the blank 11a54af71fa5ff7_7
		fill in the blank 11a54af71fa5ff7_9
Adjusted balance		$fill in the blank 11a54af71fa5ff7_10
Cash balance according to company's records		$fill in the blank 11a54af71fa5ff7_11
		fill in the blank 11a54af71fa5ff7_13
		$fill in the blank 11a54af71fa5ff7_14
	$fill in the blank 11a54af71fa5ff7_16
	fill in the blank 11a54af71fa5ff7_18
	fill in the blank 11a54af71fa5ff7_20	fill in the blank 11a54af71fa5ff7_21
Adjusted balance		$fill in the blank 11a54af71fa5ff7_22

2. Journalize the necessary entries (a.) that increase cash and (b.) that decrease cash. The accounts have not been closed. For a compound transaction, if an amount box does not require an entry, leave it blank.

a. May 31	fill in the blank d99a3302d04c06f_2	fill in the blank d99a3302d04c06f_3
	fill in the blank d99a3302d04c06f_5	fill in the blank d99a3302d04c06f_6
	fill in the blank d99a3302d04c06f_8	fill in the blank d99a3302d04c06f_9
b. May 31	fill in the blank d99a3302d04c06f_11	fill in the blank d99a3302d04c06f_12
	fill in the blank d99a3302d04c06f_14	fill in the blank d99a3302d04c06f_15
	fill in the blank d99a3302d04c06f_17	fill in the blank d99a3302d04c06f_18
	fill in the blank d99a3302d04c06f_20	fill in the blank d99a3302d04c06f_21

3. If a balance sheet is prepared for Brentwood Bike Co. on May 31, what amount should be reported as cash?
$fill in the blank 7f9a6a03c078018_1

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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