Question

in the process of reconciling its bank statement for january, maxi's clothing's accountant compiles the following information: cash balance per company books on january 30 $ 5,225 deposits in transit at month-end $ 1,900 outstanding checks at month-end $ 570 bank service charges $ 30 an nsf check returned on a customer account $ 480 the adjusted cash balance per the books on january 31 is:

Answer 1

The adjusted cash balance per the books on January 31 is $6,045.

Step-by-step explanation:

To find the adjusted cash balance per the books on January 31, we start with the cash balance per company books on January 30 which is $5,225. We then add the deposits in transit at month-end which is $1,900 and subtract the outstanding checks at month-end which is $570. Next, we subtract the bank service charges which is $30 and the NSF check returned on a customer account which is $480. Calculating these amounts, we have:

$5,225 + $1,900 - $570 - $30 - $480 = $6,045

Therefore, the adjusted cash balance per the books on January 31 is $6,045.

Answer 2

To determine the bank's net worth, calculate the total assets ($620) by summing reserves, government bonds, and loans. Then, subtract the total liabilities (deposits of $400) from the total assets to find a net worth of $220.

Step-by-step explanation:

Setting up a T-account Balance Sheet

To create a T-account balance sheet for the bank, we list assets on the left side and liabilities and net worth (equity) on the right side. Let's include the given figures:

• Assets:
  • Reserves: $50
  • Government Bonds: $70
  • Loans: $500
• Liabilities:
  • Deposits: $400

The total assets of the bank are calculated as the sum of reserves, government bonds, and loans, which equals $620 ($50 + $70 + $500).

The total liabilities are the total deposits, which equal $400.

To find the net worth, we subtract the liabilities from the assets:

Net Worth = Total Assets - Total Liabilities = $620 - $400 = $220

Therefore, the bank's net worth is $220.