Question

The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6: Cash balance according to the company's records at August 31, $24,930. Cash balance according to the bank statement at August 31, $26,420. Checks outstanding, $5,060. Deposit in transit, not recorded by bank, $4,060. A check for $170 in payment of an account was erroneously recorded in the check register as $710. Bank debit memo for service charges, $50. a. Prepare a bank reconciliation, using the format shown in Exhibit 13. b. Creative Design Co. Bank Reconciliation August 31, 20Y6 Cash balance according to bank statement $ Adjusted balance $ Cash balance according to company's records $ Adjusted balance $

Answer 1

Answer:

The adjusted balance will be of $ 25,420

Explanation:

For the bank reconciliation we should post what is the unknow information for each party.

CASH

Balance            24,930

Service Charge       -50

accounting mistake    540

(+710 to ammend the mistake - 170 real value of the check)

Adjusted Balance 25,420

BANK

Balance                 26,420

Outstanding Check -5,060

Deposit in transit    4,060

Adjusted Balance 25,420