Accounting: What the Numbers Mean 11th Edition by Wayne McManus,Daniel Viele,David Marshall

Exercise 5

Bank reconciliation adjustment
a. Show the reconciling items in a horizontal model or write the adjusting journal entry (or entries) that should be prepared to reflect the reconciling items of Exercise 5.7.
b. What is the amount of cash to be included in the October 31 balance sheet for the bank account reconciled in Exercise 5.7?
Reference Exercise 5.7:
Bank reconciliation Prepare a bank reconciliation as of October 31 from the following information:
a. The October 31 cash balance in the general ledger is $1,688.
b. The October 31 balance shown on the bank statement is $746.
c. Checks issued but not returned with the bank statement were No. 462 for $26 and No. 483 for $100.
d. A deposit made late on October 31 for $900 is included in the general ledger balance but not in the bank statement balance.
e. Returned with the bank statement was a notice that a customer's check for $150 that was deposited on October 25 had been returned because the customer's account was overdrawn.
f. During a review of the checks that were returned with the bank statement, it was noted that the amount of Check No. 471 was $64 but that in the company's records supporting the general ledger balance, the check had been erroneously recorded as a payment of an account payable in the amount of $46.