Chapter 7, Problem 7.18EX

To determine

A.

Bank Reconciliation Statement: Bank statement is prepared by bank. The company maintains its own records from its perspective. This is why the cash balance per bank and cash balance per books seldom agree. Bank reconciliation is the statement prepared by company to remove the differences and disagreement between cash balance per bank and cash balance per books.

To prepare: Bank reconciliation of CD for August 20Y6.

B:

To determine

The amount of cash to be reported on the balance sheet of CD Co.

C

To determine

To explain: Whether bank reconciliation needs to always balance.