Question

BANK STATEMENT Checks Deposits Other Balance Balance, May 1 $ 17,000 May 2 $ 7,000 24,000 May 5 #301 $ 10,000 14,000 May 7 #302 5,200 8,800 May 8 9,000 17,800 May 14 #303 460 17,340 May 17 Interest $ 100 17,440 May 22 NSF check 240 17,200 May 27 #304 4,200 13,000 May 31 Service charge 60 12,940 Balance, May 31 12,940 Cash (A) May 1 Balance 17,000 May 1 7,000 10,000 #301 May 2 May 7 9,000 5,200 #302 May 4 May 29 5,200 460 #303 May 11 4,200 #304 May 23 900 #305 May 29 May 31 Balance 17,440 PA5-2 Part 3 After the reconciliation journal entries are posted, what balance will be reflected in the Cash account in the ledger? Next

Answer 1

Adjusted Cash balance: $17,240

Step-by-step explanation:

The cash balance will be affected by the unknow information of the bank statement:

Cash May 31 Balance $17,440

Adjustment:

May 17 Interest $ 100

May 22 NSF check $ 240

May 31 Service charge $ 60

The interest will increase the cash balance

The non-sufficient-fund check we deposit is going to reduce our balance as the check wasn't cleared.

The service Charge for the bank for using their services will also decrease the cash balance:

Cash Ledger

DEBIT CREDIT

Unadj 17,440

interest 100

NSF check 240

service 60

Adj 17,240