The bookkeeper for Octagon Flowers discovered the following data for use in reconciling the bank account for July:
a. Cash balance according to the company's records at July 31, $15,600.
b. Cash balance according to the bank statement at July 31, $16,230.
c. Cheques outstanding, $3,180.
d. Deposit in transit, not recorded by bank, $1,950.
e. A $3,500 deposit received by the bank was recorded as $2,500 on the bank statement.
f. A cheque for $270 in payment of Telephone Expense was erroneously recorded in the cheque register as $720.
g. Bank debit memo for service charges, $50.
1. Prepare a bank reconciliation, using the format shown in Exhibit 7.
2. If a balance sheet were prepared for Octagon Flowers on July 31, what amount should be reported for cash?
3. Must a bank reconciliation always balance (reconcile)?

  • CreatedSeptember 15, 2015
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