Question: The cash account for Leisure Systems at February 29 2012

The cash account for Leisure Systems at February 29, 2012, indicated a balance of $4,720. The bank statement indicated a balance of $18,650 on February 29, 2012. Comparing the bank statement and the accompanying canceled checks and memos with the records reveals the following reconciling items:
a. Checks outstanding totaled $13,960.
b. A deposit of $9,350, representing receipts of February 29, had been made too late to appear on the bank statement.
c. The bank had collected $8,560 on a note left for collection. The face of the note was $8,000.
d. A check for $360 returned with the statement had been incorrectly recorded by Leisure Systems as $630. The check was for the payment of an obligation to Warwick Co. for the purchase of office supplies on account.
e. A check drawn for $930 had been incorrectly charged by the bank as $390.
f. Bank service charges for February amounted to $50.

1. Prepare a bank reconciliation.
2. Illustrate the effects on the accounts and financial statements of the bank reconciliation.

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  • CreatedFebruary 04, 2014
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