Wright Company's cash account shows a $27,700 debit balance and its bank statement shows $26,000 on...

 

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Wright Company's cash account shows a $27,700 debit balance and its bank statement shows $26,000 on deposit at the close of business on May 31. a. The May 31 bank statement lists $110 in bank service charges; the company has not yet recorded the cost of these services. b. Outstanding checks as of May 31 total $5,700. c. May 31 cash receipts of $6,300 were placed in the bank's night depository after banking hours and were not recorded on the May 31 bank statement. d. In reviewing the bank statement, a $410 check written by Smith Company was mistakenly drawn against Wright's account. e. The bank statement shows a $580 NSF check from a customer; the company has not yet recorded this NSF check. Prepare its bank reconciliation using the above information. Wright Company's cash account shows a $27,700 debit balance and its bank statement shows $26,000 on deposit at the close of business on May 31. a. The May 31 bank statement lists $110 in bank service charges; the company has not yet recorded the cost of these services. b. Outstanding checks as of May 31 total $5,700. c. May 31 cash receipts of $6,300 were placed in the bank's night depository after banking hours and were not recorded on the May 31 bank statement. d. In reviewing the bank statement, a $410 check written by Smith Company was mistakenly drawn against Wright's account. e. The bank statement shows a $580 NSF check from a customer; the company has not yet recorded this NSF check. Prepare its bank reconciliation using the above information.

Answer rating: 100% (QA)

To prepare Wright Companys bank reconciliation well start with the banks balance and make adjustments to reconcile it with the companys cash account Bank Statement Balance May 31 26000 a Bank service charges not recorded by the company 110 b Outstanding checks 5700 c Deposits in transit not yet recorded by the bank May 31 cash receipts 6300 d Bank error mistakenly drawn check by Smith Company 410 e NSF check from a customer not yet recorded by the company 580 Lets calculate the adjusted bank balance Starting with the bank statement balance 26000 bank statement balance 110 bank service charges 5700 outstanding checks 6300 deposits in transit 410 bank error 580 NSF check Adjusted bank balance 26000 110 5700 6300 410 580 26320 Now lets compare the adjusted bank balance with the companys cash account balance Companys Cash Account Balance May 31 27700 The adjusted bank balance 26320 should equal the companys cash account balance 27700 However there is a difference of 1380 27700 26320 This difference represents items that need further investigation or adjustment ... View the full answer