Question

Rich Company's unadjusted book balance at October 31, 2014 is $2,550. The following information is available for the bank reconciliation. Outstanding checks, $600 Deposits in transit, $450 Bank service charges, $90 Bank collected an accounts receivable for Rich Company, $1,000 NSF check written by one of Rich's customers, $600 Based on this information Rich's true cash balance is:

Answer 1

Answer:

The correct answer is $2,860.

Explanation:

According to the scenario, the given data are as follows:

Unadjusted book balance = $2,550

outstanding checks = $600

Deposit in Transit = $450

Bank service charges = $90

Bank collected account receivable = $1000

.Check written by Rich's customer = $600

So, true cash balance can be calculated as follows :

Cash balance = $2,550 + $ 1000 - $90 - $600

= $2,860

Hence, the correct answer is $2,860.