E7-6 Sally Rice is unable to reconcile the bank balance at January 31. Sally’s reconciliation is shown here.
Prepare bank reconciliation and adjusting entries.
|
Cash balance per bank |
$3,677.20 |
|
Add: NSF check |
450.00 |
|
Less: Bank service charge |
28.00 |
|
Adjusted balance per bank |
$4,099.20 |
|
Cash balance per books |
$3,975.20 |
|
Less: Deposits in transit |
590.00 |
|
Add: Outstanding checks |
770.00 |
|
Adjusted balance per books |
$4,155.20 |
Instructions
- (a) What is the proper adjusted cash balance per bank?
- (b) What is the proper adjusted cash balance per books?
- (c) Prepare the adjusting journal entries necessary to determine the adjusted cash balance per books.
