Using the following information, prepare a bank reconciliation.Bank balance: $6,788Book balance: $6,525Deposits in transit: $1,688Outstanding checks: $569 and $1,523Bank charges: $75Bank incorrectly charged the account $75. The bank will correct the error next month.Check number 2456 correctly cleared the bank in the amount of $245 but posted in the accounting records as $254. This check was expensed to Utilities Expense. Bank ReconciliationBank Statement Balance at (date) $fill in the blank 1Add: Deposits in Transit Outstanding ChecksLess: - Select -Adjusted Bank Balance $fill in the blank 8 Book Balance at (date) $fill in the blank 9Add: - Select -Less: - Select -Adjusted Book Balance $fill in the blank 14

Bank reconciliation tries to reconcile the bank balance between bank and books of account. There are certain transactions like outstanding checks, deposits in transit, bank charges, NSF return, wrong recording of amount which results in difference in the balance of cash as per book and bank. It is important for companies to reconcile the balance at end of each month to determine the correct adjusted balance.Reconciliation for the company is shown below: Bank Reconciliation Bank statement balance $6,788 Add: Deposit in transit $1,688 Add: Incorrect charges $75 Less: Outstanding checks $2,092 -$329 Adjusted Bank balance $6,459 Book balance at (date) $6,525 Add: Incorrect amount (254-245) $9 Less: Bank charges -$75 -$66 Adjusted book balance $6,459

Answered: Using the following information,…

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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Question

Using the following information, prepare a bank reconciliation.

Bank balance: $6,788
Book balance: $6,525
Deposits in transit: $1,688
Outstanding checks: $569 and $1,523
Bank charges: $75
Bank incorrectly charged the account $75. The bank will correct the error next month.
Check number 2456 correctly cleared the bank in the amount of $245 but posted in the accounting records as $254. This check was expensed to Utilities Expense.

Bank Reconciliation

Bank Statement Balance at (date)		$fill in the blank 1
Add:
		Deposits in Transit
		Outstanding Checks
Less:
		- Select -
Adjusted Bank Balance		$fill in the blank 8

Book Balance at (date)		$fill in the blank 9
Add:
		- Select -
Less:
		- Select -
Adjusted Book Balance		$fill in the blank 14