Chapter 4, Problem 46E

To determine

Concept Introduction:

Bank Reconciliation:

Bank reconciliation is the process in which the entity reconciles its cash entries in accounts with the entries in bank statement issued by the bank. The entity prepares bank reconciliation statement and it has two sides; Bank Side and Cash side

Requirement-1:

To Prepare:

The Bank reconciliation Statement.

Answer to Problem 46E

The Bank reconciliation Statement is as follows:

Valentine Investigations
Bank Reconciliation Statement
As on February 28
Bank Side				Book Side
Balance as per Bank statement		$ 11,610	Balance as per Cash Book		$ 11,883
Add:			Add:
Deposit in transit		$ 4,580
Less:			Less:
Outstanding Checks		$ 5,157	Debit Memo	$ 800
			Bank Service Charges	$ 50	$ 850
Reconciled Balance		$ 11,033	Reconciled Balance		$ 11,033

Explanation of Solution

The Bank reconciliation Statement is explained as follows:

Valentine Investigations
Bank Reconciliation Statement
As on February 28
Bank Side				Book Side
Balance as per Bank statement		$ 11,610	Balance as per Cash Book (7444+106780-102341)		$ 11,883
Add:			Add:
Deposit in transit		$ 4,580
Less:			Less:
Outstanding Checks		$ 5,157	Debit Memo	$ 800
			Bank Service Charges	$ 50	$ 850
Reconciled Balance		$ 11,033	Reconciled Balance		$ 11,033

To determine

Concept Introduction:

Bank Reconciliation:

Bank reconciliation is the process in which the entity reconciles its cash entries in accounts with the entries in bank statement issued by the bank. The entity prepares bank reconciliation statement and it has two sides; Bank Side and Cash side.

Requirement-2:

To Prepare:

The necessary adjusting entries.

Answer to Problem 46E

The necessary adjusting entries are as follows:

Valentine Investigations
Bank Reconciliation
Journal Entries
Date	Accounts titles and Explanation	Debit	Credit
Feb. 28	Electricity Expense	$ 800
	Cash		$800
Feb. 28	Bank Service Charges	$ 50
	Cash		$ 50

Explanation of Solution

The necessary adjusting entries are explained as follows:

Valentine Investigations
Bank Reconciliation
Journal Entries
Date	Accounts titles and Explanation	Debit	Credit
Feb. 28	Electricity Expense	$ 800
	Cash		$800
	(Being adjustment made for expenses)
Feb. 28	Bank Service Charges	$ 50
	Cash		$ 50
	(Being adjustment made for Bank Charges)

To determine

Concept Introduction:

Bank Reconciliation:

Bank reconciliation is the process in which the entity reconciles its cash entries in accounts with the entries in bank statement issued by the bank. The entity prepares bank reconciliation statement and it has two sides; Bank Side and Cash side.

Requirement-3:

To Indicate:

The amount of cash to be reported on October 31 balance sheet.

Answer to Problem 46E

The amount of cash to be reported on October 31 balance sheet shall be $11,033.

Explanation of Solution

The Bank reconciliation Statement is explained as follows:

Valentine Investigations
Bank Reconciliation Statement
As on February 28
Bank Side				Book Side
Balance as per Bank statement		$ 11,610	Balance as per Cash Book (7444+106780-102341)		$ 11,883
Add:			Add:
Deposit in transit		$ 4,580
Less:			Less:
Outstanding Checks		$ 5,157	Debit Memo	$ 800
			Bank Service Charges	$ 50	$ 850
Reconciled Balance		$ 11,033	Reconciled Balance		$ 11,033

Hence, the amount of cash to be reported on October 31 balance sheet shall be $11,033.