Valentine Investigations has the following information for its cash account: Balance, 1/31 Deposits during February Checks written during February $ 1,444 106,780 102,341 Valentine's bank statement for February contained the following information: Balance per bank, 1/31 Add: February deposits $ 8,910 104,950 $ 113,860 Less: Checks paid in February Bank service charge Debit memo (electric bill) Balance per bank, 2/28 $(101,400) (50) (800) (102,250) $ 11,610 A comparison of company records with the bank statement provided the following data: At 1/31 At 2/28 Deposits in transit Outstanding checks $2,750 4,216 $4,580 5,157

Valentine Investigations has the following information for its cash account: Balance, 1/31 Deposits during February Checks written during February $ 1,444 106,780 102,341 Valentine's bank statement for February contained the following information: Balance per bank, 1/31 Add: February deposits $ 8,910 104,950 $ 113,860 Less: Checks paid in February Bank service charge Debit memo (electric bill) Balance per bank, 2/28 $(101,400) (50) (800) (102,250) $ 11,610 A comparison of company records with the bank statement provided the following data: At 1/31 At 2/28 Deposits in transit Outstanding checks $2,750 4,216 $4,580 5,157

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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Concept explainers

Bank Reconciliation Statement

As a commerce student, we all know that every business has to maintain a cash book to maintain all his cash and bank transactions. A cash book is a book which has two columns, one cash column and one bank column.

Question

Required:
1. Prepare a bank reconciliation as of February 28.
2. Prepare adjusting entries for Valentine based on the information developed in the bank reconciliation.
3. What is the amount of cash that should be reported on the February 28 balance sheet?

Valentine Investigations has the following information for its cash account:
Balance, 1/31
Deposits during February
Checks written during February
$ 1,444
106,780
102,341
Valentine's bank statement for February contained the following information:
Balance per bank, 1/31
Add: February deposits
$ 8,910
104,950
$ 113,860
Less:
Checks paid in February
Bank service charge
Debit memo (electric bill)
Balance per bank, 2/28
$(101,400)
(50)
(800)
(102,250)
$ 11,610
A comparison of company records with the bank statement provided the following data:
At 1/31
At 2/28
Deposits in transit
Outstanding checks
$2,750
4,216
$4,580
5,157

Definition Definition Entries made at the end of every accounting period to precisely replicate the expenses and revenue of the current period. This is also known as end of period adjustment. It can also refer to financial reporting that corrects errors made previously in the accounting period. Every adjustment entry affects at least one real account and one nominal account.

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