The cash data of Eddy Automotive for October 2021 follow: 

Eddy Automotive received the following bank statement on October 31, 2021: 

Additional data for the bank reconciliation include the following: 

a. The EFT deposit was a receipt of monthly rent. The EFT debit was a monthly insurance payment.

b. The unauthorized signature check was received from a customer and returned by the bank unpaid.

c. The correct amount of check number 3115, a payment on account, is $1,380. (Eddy Automotive’s accountant mistakenly recorded the check as $1,830.)

d. The bank collected a note receivable for Eddy Automotive.

Requirements 

1. Prepare Eddy Automotive’s bank reconciliation at October 31, 2021.

2. Prepare the journal entries required at October 31, 2021.

3. Describe how a bank account and the bank reconciliation help the general manager control Eddy Automotive’s cash.

Transcribed Image Text:

Cash Date October 1 31 31 Cash Receipts (CR) Date October 2 8 10 16 22 29 Item Balance 30 Total $ 2,828 597 Cash Debit 1,652 837 360 904 Jrnl. Ref. 2,152 $9,330 CR 6 CP 11 Debit 9,330 Check No. Credit Cash Payments (CP) 3113 3114 3115 3116 3117 3118 3119 3120 3121 3122 Total 10,122 Account No. 101 Balance 7,950 17,280 7,158 Cash Credit $ 1,542 1,729 1,830 47 782 169 478 1,023 234 2,288 $10,122