Answer:
THIS IS THE COMPLETE QUESTION
For each of the items indicate whether its amount affects the bank or book side of a bank reconciliation and is an addition or a subtraction in a bank reconciliation and whether an adjusting journal entry is required:
a. Unrecorded deposits
b. Interest on cash balance
c. Bank service charges
d. Debit memos
e. Outstanding checks
f. Credit memos
g. NSF checks
ANSWER:
a)Unrecorded deposits:
Unrecorded deposits may be added to the bank balance , and it affects the bank side of the reconciliation ,The unrecorded deposits doesn't require an adjusting journal entry as well.
b). Interest on cash balance:
Interest on cash balance can be regarded as book addition,which required adjusting journal entry
c)Bank service charges:
Bank service charges is a subtraction in a bank reconciliation, it affects the bank side of the reconciliation, Hence it requires an adjusting journal entry .
d)Debit and credit memos:
Debit memos is a subtraction in a book reconciliation,and it requires adjusting journal entry.
e)Outstanding Checks :
Outstanding Checks a subtraction from the bank balance in the reconciliation and affects the bank side of the bank reconciliation, However it does not require adjustments or adjusting journal entries.
f)Credit memos :
Credit memos can be regarded as book addition, an addition is required to the book side in the reconciliation.it require an adjusting journal entry
NSF checks:
NSF checks affects the book side of the reconciliation, This is an substraction to the book side in the reconciliation, It requires an adjusting journal entry .
Explanation:
✓Unrecorded deposits can be described as deposits which is recorded into the books but has not been recorded by the bank.
✓Interest on cash balance can be described as a reconciling items
that banks record as credit even though it has not been recorded by book as debit
✓Debit Memos is described as a deduction in banks statement as a result of deduction in bank balance.
