3 lank raconciliation and entries The cash account for Stone

-3 lank raconciliation and entries The cash account for Stone Systems at July 31, 2014, indicated a balance of $17,750. The 0BJ.5 bank statement indicated a balance of $33,650 on July 31, 2014. Comparing statement and the accompanying canceled checks and memos with the records reveals the following reconciling items the bank a. Checks outstanding totaled $17,865. b. A deposit of $9,150, representing receipts of July 31, had been made too late to appear on the bank statement. c. The bank had collected $6,095 on a note left for collection. The face of the note was $5,750 d. A check for $390 returned with the statement had been incorrectly recorded by Stone Systems as $930. The check was for the payment of an obligation to Holland Co. for the purchase of office supplies on account. e. A check drawn for $1,810 had been incorrectly charged by the bank as $1,18o. f. Bank service charges for July amounted to $80. Instructions 1. Prepare a bank reconciliation. 2. Journalize the necessary entries. The accounts have not been closed. 3. If a balance sheet were prepared for Stone Systems on July 31, 2014, what amourt X, should be reported as cash? ,

Solution

Part 1

Stone system

Bank Reconciliation

Add: proceeds of note collected by bank including 345 interest

Error in recording check

Deductct: bank service charges

Adjusted balance

6095

540

6635

24385

80

24305

Part B

Part C

If a balance sheet of Stone system is prepared on July 31,2014 $24305 should be reported as cash.

Cash balance according to bank statement		33650
Add: deposit of July 31, not recorded by bank		9150
		42800
Deduct: outstanding checks	17865
Bank error in charging chech as 1180 in stead of 1810	630	18495
Adjusted balance		24305
Cash balance according to company\'s record		17750
Add: proceeds of note collected by bank including 345 interest Error in recording check Deductct: bank service charges Adjusted balance	6095 540	6635 24385 80 24305