The folowing information applies to the questions displayed

The folowing information applies to the questions displayed below. The bookkeeper at Tony Company has asked you to prepare a bank reconciliation as of February 29. The February bank statement and the February T-account for cash showed the following (summarized) BANK STATEMENT February 2 February 5 Fetnary9 February 2 February 14 Fetruary 23 05 300 Service charge Ss 0 Cash (A) Tony Company\'s bank reconciliation at the end of January showed no outstanding checks. No deposits were in transit at the end of January, but a deposit was in transit at the end of February. 700 points Required: Prepare a bank reconciliation for February.

Solution

Bank Reconciliation Statement: bank Statement Company\'s books ending Balance 1505 Ending balance 9450 Add: Add: Deposit in transit 9400 Iinterest earned 310 Subtotal 10905 Subtotal 9760 Less: Less: Outstanding check 1600 NSF Check 400 Service charges 55 455 Adjusted Balance in Bank Statement 9305 Adjusted balance as per books 9305 Journal entries: Cash account Dr. 310     Interest revenue 310 Accounts receivable Account Dr. 400      Cash account 400 Misc Expense Account Ddr. 55     Cash account 55 Balance of cash to be shown in book: $ 9305 Total Cash and cash equivalent shown in Balance sheet: Cash balance 9305 Add: Petty cash balance 210 Cash and cash equivalent 9515