Question

The following information pertains to Sheridan Video Company.

1. Cash balance per bank, July 31, $7,943.
2. July bank service charge not recorded by the depositor $37.
3. Cash balance per books, July 31, $7,964.
4. Deposits in transit, July 31, $1,840.
5. Bank collected $1,240 note for Sheridan in July, plus interest $45, less fee $29. The collection has not been recorded by Sheridan, and no interest has been accrued.
6. Outstanding checks, July 31, $600.

Required:
Prepare a bank reconciliation at July 31.

Answer 1

Bank reconciliation for the month ended July 31

Particulars Amount

Balance as per bank $7,943

Add: Deposit in transit $1,840

Less: Outstanding checks $600

Adjusted balance as per bank $9,183

Balance as per books $7,964

Add: Direct collections by bank $1,256

($1,240 + $45 - $29)

Less: Bank charges $37

Adjusted balance as per books $9,183