Question

Bill Lewis owns a construction business, Lewis Supply Co. The following cash information is available for the month of October 2016.
As of October 31, the bank statement shows a balance of $21,400. The October 31 unadjusted balance in the Cash account of Lewis Supply Co. is $18,400. A review of the bank statement revealed the following information:
1. A deposit of $2,600 on October 31, 2016, does not appear on the October 31 bank statement.
2. A debit memo for $75 was included in the bank statement for the purchase of a new supply of checks.
3. When checks written during the month were compared with those paid by the bank, three checks amounting to $2,075 were found to be outstanding.
4. It was discovered that a check to pay for repairs was correctly written and paid by the bank for $1,500 but was recorded on the books as $5,100.
Required
a. Prepare a bank reconciliation at the end of October showing the true cash balance.
b. Prepare any necessary journal entries to adjust the books to the true cash balance.


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  • CreatedApril 20, 2015
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