The following data were accumulated for use in reconciling the bank account of Allenby Co. for August:
1. Cash balance according to the company's records at August 31, $31,080.
2. Cash balance according to the bank statement at August 31, $38,280.
3. Checks outstanding, $12,460.
4. Deposit in transit, not recorded by bank, $5,850.
5. A check for $180 in payment of an account was erroneously recorded in the check register as $810.
6. Bank debit memo for service charges, $40.
a. Prepare a bank reconciliation, using the format shown in Exhibit 7.
b. If the balance sheet were prepared for Allenby Co. on August 31, what amount should be reported for cash?
c. Must a bank reconciliation always balance (reconcile)?

  • CreatedFebruary 28, 2014
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