Question

Clayborn Company deposits all cash receipts on the day they are received and makes all cash payments by check. At the close of business on May 31, its Cash account shows a debit balance of $22,025. Clayborn's May bank statement shows $19,800 on deposit in the bank. Determine the adjusted cash balance using the following information: Deposit in transit $ 6,700 Outstanding checks $ 5,600 Bank service fees, not yet recorded by company $ 75 A NSF check from a customer, not yet recorded by the company $ 1,050 The adjusted cash balance should be: Multiple Choice $20,925 $14,200 $20,900 $21,950 $26,500

Answer 1

$20,900

Step-by-step explanation:

Calculation for what The adjusted cash balance should be:

Using this formula

Adjusted cash balance= Bank balance + deposits in transit - outstanding check

Let plug in the formula

Adjusted cash balance = $19,800 + $ 6,700 - $ 5,600

Adjusted cash balance= $20,900

Therefore The adjusted cash balance should be:$20,900