Question

he following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6: Cash balance according to the company's records at August 31, $28,800. Cash balance according to the bank statement at August 31, $30,270. Checks outstanding, $5,850. Deposit in transit, not recorded by bank, $4,690. A check for $480 in payment of an account was erroneously recorded in the check register as $840. Bank debit memo for service charges, $50. a. Prepare a bank reconciliation, using the format shown in Exhibit 13.

Answer 1

Creative Design Co.

Bank Reconciliation

August 31, 20Y6

Cash balance according to Bank Statement $30,270

Add: Deposit in transit, not recorded by bank $4,690

$34,960

Less: Outstanding checks ($5,850)

Adjusted Balance $29,110

Cash balance according to Company's records $28,800

Add: Error in recording check (840 - 480) $360

$29,160

Less: Bank service costs ($50)

Adjusted balance $29,110