Question

In preparing its August 31, 2020 bank reconciliation, Vaughn Manufacturing has available the following information:

Balance per bank statement, 8/31/20 $25750
Deposit in transit, 8/31/20 3480
Return of customer's check for insufficient funds, 8/30/20 600
Outstanding checks, 8/31/20 2760
Bank service charges for August 100

At August 31, 2020, Vaughn's correct cash balance is :_________

a. $25030.
b. $25770.
c. $26470.
d. $25870.

Answer 1

c. $26470

Step-by-step explanation:

Calculation to determine what Vaughn's correct cash balance is

Using this formula.

Correct cash balance =Balance per bank statement + Deposit in transit - Outstanding checks

Let plug in the formula

Correct cash balance= $25750 + 3480 - 2760

Correct cash balance=$26470

Therefore At August 31, 2020, Vaughn's correct cash balance is:$26470