Problem 6-54 Bank Reconciliation
The cash account of Delta, Inc., disclosed a balance of $17,056.48 on October 31. The bank statement as of October 31 showed a balance of $21,209.45. Upon comparing the statement with the cash records, the following facts were developed.
- Delta’s account was charged on October 26 for a customer’s uncollectible check amounting to $1,143.
- A 2-month, 9%, $3,000 customer’s note dated August 25, discounted on October 12, was dishonored October 26 and the bank charged Delta $3,050.83, which included a protest fee of $5.83.
- A customer’s check for $725 was entered as $625 by both the depositor and the bank but was later corrected by the bank.
- Check No. 661 for $1,242.50 was entered in the cash disbursement journal at $1,224.50 and check No. 652 for $32.90 was entered as $329.00. The company uses the voucher system.
- Bank services charges of $39.43 for October were not recorded on the books.
- A bank memo stated that M. Sears’ note for $2,500 and interest of $62.50 had been collected on October 29, and the bank charged $12.50. (No entry was made on the books when the note was sent to the bank for collection.)
- Receipts of October 29 for $6,850 were deposited November 1.
The following checks were outstanding on October 31:
No. 620 $ 1,250.00 No. 671 $ 732.50
No. 621 3,448.23 No. 673 187.90
No. 632 2,405.25 No. 675 275.72
No. 670 1,775.38 No. 676 2,233.15
- Prepare a bank reconciliation as of October 31.
- Give the journal entries required as a result of the preceding information.