Question

The U.S. Chamber of Commerce provides a free monthly bank reconciliation template at business.uschamber.com/tools/banker_m.asp. Riley Whitelaw just received her bank statement notice online. She wants to reconcile her checking account with her bank statement and has chosen to reconcile her accounts manually. Her checking books shows a balance of $698. Her bank statement reflects a balance of $1,348. Checks outstanding are No. 2146, $25; No. 2148, $58; No. 2152, $198; and No.2153, $464. Deposits in transit are $100 and $50. There is a $15 service charge and S5 ATM charge in addition to notes collected of S50 and $25. Reconcile Riley's balances.

Answer 1

To reconcile Riley's checking account balance, we need to adjust for the outstanding checks, deposits in transit, service charges, ATM charge, and notes collected. After making the adjustments, we can compare the adjusted balances of the checking books and the bank statement to ensure they match.

Step-by-step explanation:

To reconcile Riley's checking account balance, we need to adjust for the outstanding checks, deposits in transit, service charges, ATM charge, and notes collected. Let's go through each adjustment step by step:

1. Outstanding Checks: Subtract the amounts of the outstanding checks from the balance of the checking books. In this case, outstanding checks are No. 2146 ($25), No. 2148 ($58), No. 2152 ($198), and No. 2153 ($464). Subtracting $25, $58, $198, and $464 from the checking book balance of $698 gives us $698 - $25 - $58 - $198 - $464 = $-
2. Deposits in Transit: Add the amounts of the deposits in transit to the balance of the checking books. In this case, deposits in transit are $100 and $50. Adding $100 and $50 to the checking book balance gives us $+.
3. Service Charge and ATM Charge: Subtract the total amount of service charge and ATM charge from the balance of the checking books. In this case, the total amount is $15 + $5 = $. Subtracting $15 + $5 from the checking book balance gives us $-
4. Notes Collected: Add the total amount of notes collected to the balance of the checking books. In this case, the total amount is $50 + $25 = $. Adding $50 + $25 to the checking book balance gives us $+.

To reconcile Riley's checking account balance with her bank statement, we need to adjust the bank statement balance as well. The adjustment steps are the same as those for the checking books. After making the adjustments, we can compare the adjusted balances of the checking books and the bank statement to ensure they match.

Answer 2

To reconcile Riley's checking account, her checkbook balance is adjusted for outstanding checks, deposits in transit, service charges, ATM fees, and notes collected, resulting in a reconciled balance of $158. This suggests a discrepancy with the bank statement, prompting a check for additional transactions or errors.

Step-by-step explanation:

To reconcile Riley's checking account, we start with her checkbook balance and make adjustments for any outstanding transactions and any additional charges or credits that have not yet been recorded in the checkbook.

Riley's checkbook balance is $698. We need to subtract the total amount of outstanding checks, which are Check No. 2146 for $25, Check No. 2148 for $58, Check No. 2152 for $198, and Check No.2153 for $464. Those add up to $745 in total. This decreases the balance.

Next, we must add any deposits in transit to the checkbook balance. There's a $100 deposit and a $50 deposit still pending, adding up to $150. Finally, we need to subtract any charges, such as the $15 service charge and $5 ATM charge, and add any collections like the $50 and $25 notes collected.

Adjusting Riley's checkbook balance accordingly, the reconciled balance is calculated as:

• Starting balance: $698
• Minus outstanding checks: $745
• Add deposits in transit: $150
• Subtract service charge: $15
• Subtract ATM charge: $5
• Add notes collected: $75

Reconciled balance: $698 - $745 + $150 - $15 - $5 + $75 = $158

Comparing this reconciled balance with the bank statement balance, there might be other transactions or errors not accounted for, considering the bank shows a balance of $1,348. Riley should verify for any additional transactions or bank errors.

Balancing your checkbook regularly is crucial to managing your money, keeping track of your cash flow, and avoiding overdrafts and the associated fees.