Question

Di Stefano Office Supply Company received a bank statement showing a balance of $67605 as of March 31; 2019 The firm's records showed a book balance of $69.439 on March 31. The difference between the two balances was caused by the following items

1. A debit memorandum for $42, which covers the bank's collection fee for the note (item 6).
2. A deposit in transit of $3,300
3. A check for $240 issued by another firm that was mistakenly charged to Di Stefano's account.
4. A debit memorandum for an NSF check of $6,095 issued by Wozniak Construction Company, a credit customer.
5. Outstanding checks: Check 3782 for $1,800, Check 3840 for $143
6. A credit memorandum for a $5,900 noninterest-bearing note receivable that the bank collected for the firm.
Prepare a bank reconciliation statement for the firm as of March 31. Prepare the necessary journal entries for March 31, 2019 from the statement.

Answer 1

To prepare a bank reconciliation statement, adjust the bank balance by adding deposits in transit, subtracting outstanding checks, and including any errors. The necessary journal entries include debiting cash for deposits in transit and accounts receivable for NSF checks, and crediting accounts payable, notes receivable, and income accounts.

Step-by-step explanation:

To prepare a bank reconciliation statement for Di Stefano Office Supply Company as of March 31, 2019, we need to account for the differences between the bank statement balance and the book balance.

1. Start with the bank statement balance of $67,605. Add the deposit in transit of $3,300, and subtract the outstanding checks of $1,800 and $143. Then subtract the debit memorandum for the note collection fee ($42) and the NSF check ($6,095) issued by Wozniak Construction Company. Finally, add the credit memorandum for the noninterest-bearing note receivable ($5,900).

2. The adjusted bank balance should match the book balance of $69,439.

To journalize the necessary entries for March 31, 2019:

- Debit Cash for $3,300 (deposit in transit)

- Debit Accounts Receivable for $6,095 (NSF check)

- Credit Accounts Payable for $240 (check issued by another firm)

- Credit Notes Receivable for $5,900 (credit memorandum for note receivable)

- Credit Other Income for $42 (debit memorandum for note collection fee)

- Debit Other Income for $143 (outstanding check)