Utrillo Beds and Mattresses sells beddings to resort and lodging operations. Its bank statement for May 2008 shows the following data:
|
Balance 5/1 |
$12,650 |
Balance 5/31 |
$14,280 |
|
Debit memorandum: NSF check |
$175 |
Credit memorandum: Collection of note receivable |
$505 |
The cash balance per books at May 31 is $13,319. Your review of the data reveals the
Following:
1. The NSF check was from Hop Hotel Co., a customer.
2. The note collected by the bank was a $500, three month, 12 percent note. The bank charged a $10 collection fee. No interest has been accrued.
3. Outstanding checks at May 31 total $2,410.
4. Deposits in transit at May 31 total $1,752.
5. A Utrillo check for $352 dated May 10 cleared the bank on May 25. This check, which was a payment on account, was journalized for $325.
Instructions
(a) Prepare bank reconciliation at May 31.
(b) Journalize the entries required by the reconciliation.