Question

Xenon Inc.’s August 31 bank statement had an ending cash balance of $2,567. On August 31, Xenon’s general ledger showed a balance of $860. After comparing the general ledger to the bank statement the following items were noted: Outstanding checks: $2,250 Interest paid by the bank: $12 An NSF check from one of Xenon’s customers: $32 Deposits in transit: $1,900 A service fee charged by the bank: $8 A direct deposit from a customer: $1400 Check #345 was written at Acme Insurance; the amount of the check was $615. It was recorded in the general ledger for $600.

Prepare a bank reconciliation for Xenon, Inc.

Answer 1

Bank Reconciliation Statement as at August 31

Balance at Bank as per Updated Cash Book $2,281

Add Unpresented Cheques $2,250

Less Lodgements not yet credited ($1,900)

Balance as per Bank Statement $2,631

Step-by-step explanation:

Step 1 Bring the Cash Book Bank Balance up to date

Debit :

Balance as at August 31, $860

Interest $12

NSF check $32

Direct deposit $1400

Totals $2,304

Credit :

Service fee charged $8

Insurance understated $15

Updated Cash Book Balance (Balancing figure) $2,281

Totals $2,304

Step 2 Prepare the Bank Reconciliation Statement

Bank Reconciliation Statement as at August 31

Balance at Bank as per Updated Cash Book $2,281

Add Unpresented Cheques $2,250

Less Lodgements not yet credited ($1,900)

Balance as per Bank Statement $2,631