Question

This information relates to the Cash account in the ledger of Howard Company.

Balance September 1—$16,400; Cash deposited—$64,000
Balance September 30—$17,600; Checks written—$62,800
The September bank statement shows a balance of $16,500 at September 30 and the following memoranda
Credits Debits
Collection of NSF
electronic funds transfer $1,830 check: $560
Kane Safety
Interest earned on checking account 45 deposit 60
box
rent
At September 30, deposits in transit were $4,738 and outstanding checks totaled $2,383.
Prepare the bank reconciliation at September 30, 2017.

Answer 1

Bank Reconciliation Statement as at September 30

Balance as per Cash Book (Updated) $18,855

Add Unpresented Cheques $2,383

Less Lodgements not yet credited ($4,738)

Balance as per Bank Statement $16,500

Step-by-step explanation:

The first step in preparing a Bank Reconciliation Statement is to Update the Cash Balance in the Company`s records as follows :

Debit :

Balance as at September 30 $17,600

Interest Earned $45

Funds Transfer $1,830

Totals $19,505

Credit:

Balance as per Cash Book (updated) $18,855

NSF $650

Totals $19,505

The next step is to prepare a Bank Reconciliation Statement

Bank Reconciliation Statement as at September 30

Balance as per Cash Book (Updated) $18,855

Add Unpresented Cheques $2,383

Less Lodgements not yet credited ($4,738)

Balance as per Bank Statement $16,500