Question

Kevin Malone, accountant at Alfredo & Associates, had the hardest time reconciling the cash account in November. He collected the following information:

Bank statement balance, 11/30/2020 $12,345
Unadjusted book balance, 11/30/2020 $8,888
Bank service charge $50
Outstanding checks $6,925
Interest earned $329
NSF check from client $550
Deposit in transit $2,450
Note receivable collected by bank $2,250

Kevin properly included each of the above items on the reconciliation but still could not agree the adjusted book/bank balances. A pesky variance remained. After additional hours of review, Kevin identified that the check from customer Eugene Popo was incorrectly recorded on the books. The bank properly recorded the amount of $234,567, but Kevin had transposed two of the numbers when initially recording the transaction. Once the error was corrected, the bank reconciliation.

What amount did Kevin initially record in the books for the Popo check?

Answer 1

$237,564

Step-by-step explanation:

Kevin Malone

Bank Reconciliation - November 30

Bank's Cash Balance Company's Cash Balance

Particulars Amount Particulars Amount

Ending balance as per $12,345 Ending balance as $8,888

Bank statement per cash books

Additions: Additions:

Outstanding Deposits $2,450 Interest earned $329

Note collection by bank $2,250

Deductions: Deductions:

Outstanding checks $6,925 NSF Check $550

Service charge $50

Incorrect recording of $2,997

check (Balance figure)

Up to date cash balance $7,870 Up to date cash balance $7,870

as per bank as per books

Amount at which Popo check was initial recorded in Kevin books = $234,567 + $2,997 = $237,564