Pacific Furniture Company deposits all cash receipts each Wednesday and Friday in a night depository, after banking hours. The data required to reconcile the bank statement as of June 30 have been taken from various documents and records and are reproduced as follows. The sources of the data are printed in capital letters. All checks were written for payments on account.
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JUNE BANK STATEMENT: |
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MEMBER FDIC |
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AMERICAN NATIONAL BANK |
ACCOUNT NUMBER |
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OF DETROIT |
FROM 6/01/20– |
TO 6/30/20– |
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DETROIT, MI 48201 2500 |
(313)933 8547 |
BALANCE |
9,447.20 |
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9 |
DEPOSITS |
8,691.77 |
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20 |
WITHDRAWALS |
7,345.91 |
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PACIFIC FURNITURE COMPANY |
4 |
OTHER DEBITS AND CREDITS |
2,298.70CR |
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NEW BALANCE |
13,091.76 |
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CHECKS AND OTHER DEBITS |
DEPOSITS |
DATE |
BALANCE |
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No.731 |
162.15 |
No.738 |
251.40 |
690.25 |
6/01 |
9,723.90 |
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No.739 |
60.55 |
No.740 |
237.50 |
1,080.50 |
6/02 |
10,506.35 |
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No.741 |
495.15 |
No.742 |
501.90 |
854.17 |
6/04 |
10,363.47 |
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No.743 |
671.30 |
No.744 |
506.88 |
840.50 |
6/09 |
10,025.79 |
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No.745 |
117.25 |
No.746 |
298.66 |
MS 2,500.00 |
6/09 |
12,109.88 |
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No.748 |
450.90 |
No.749 |
640.13 |
MS 125.00 |
6/09 |
11,143.85 |
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No.750 |
276.77 |
No.751 |
299.37 |
896.61 |
6/11 |
11,464.32 |
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No.752 |
537.01 |
No.753 |
380.95 |
882.95 |
6/16 |
11,429.31 |
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No.754 |
449.75 |
No.756 |
113.95 |
1,606.74 |
6/18 |
12,472.35 |
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No.757 |
407.95 |
No.760 |
486.39 |
897.34 |
6/23 |
12,475.35 |
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942.71 |
6/25 |
13,418.06 |
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NSF |
291.90 |
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6/28 |
13,126.16 |
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SC |
34.40 |
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6/30 |
13,091.76 |
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EC –– ERROR CORRECTION |
OD –– OVERDRAFT |
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MS –– MISCELLANEOUS |
PS –– PAYMENT STOPPED |
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NSF –– NOT SUFFICIENT FUNDS |
SC –– SERVICE CHARGE |
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THE RECONCILEMENT OF THIS STATEMENT WITH YOUR RECORDS IS ESSENTIAL. ANY ERROR OR EXCEPTION SHOULD BE REPORTED IMMEDIATELY.
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CASH ACCOUNT: |
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Balance as of June 1 |
$9,317.40 |
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CASH RECEIPTS FOR MONTH OF JUNE |
$9,565.31 |
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DUPLICATE DEPOSIT TICKETS: |
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Date and amount of each deposit in June: |
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Date |
Amount |
Date |
Amount |
Date |
Amount |
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June 1 |
$1,080.50 |
June 10 |
$ 896.61 |
June 22 |
$ 897.34 |
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3 |
854.17 |
15 |
882.95 |
24 |
942.71 |
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8 |
840.50 |
17 |
1,660.47 |
30 |
1,510.06 |
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CHECKS WRITTEN: |
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Number and amount of each check issued in June: |
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Check No. |
Amount |
Check No. |
Amount |
Check No. |
Amount |
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740 |
$237.50 |
747 |
Void |
754 |
$ 449.75 |
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741 |
495.15 |
748 |
$450.90 |
755 |
272.75 |
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742 |
501.90 |
749 |
640.31 |
756 |
113.95 |
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743 |
671.30 |
750 |
276.77 |
757 |
407.95 |
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744 |
506.88 |
751 |
299.37 |
758 |
259.60 |
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745 |
117.25 |
752 |
537.01 |
759 |
901.50 |
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746 |
298.66 |
753 |
380.95 |
760 |
486.39 |
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Total amount of checks issued in June |
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$8,305.84 |
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BANK RECONCILIATION FOR PRECEDING MONTH: |
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Pacific Furniture Company Bank Reconciliation May 31, 20— |
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Cash balance according to bank statement |
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$ 9,447.20 |
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Add deposit for May 31, not recorded by bank |
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690.25 |
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$10,137.45 |
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$162.15 |
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345.95 |
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251.40 |
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60.55 |
820.05 |
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$ 9,317.40 |
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$ 9,352.50 |
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35.10 |
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$ 9,317.40 |
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Instructions
1. Prepare a bank reconciliation as of June 30. If errors in recording deposits or checks are discovered, assume that the errors were made by the company. Assume that all deposits are from cash sales. All checks are written to satisfy accounts payable.
2. Journalize the necessary entries. The accounts have not been closed.
3. What is the amount of Cash that should appear on the balance sheet as of June 30?
4. Assume that a canceled check for $390 has been incorrectly recorded by the bank as $930. Briefly explain how the error would be included in a bank reconciliation and how it should be corrected.