Poorten Company’s bank statement for May 2014 shows the following data.

The cash balance per books at May 31 is $13,319. Your review of the data reveals the following.
1. The NSF check was from Copple Co., a customer.
2. The note collected by the bank was a $500, 3-month, 12% note. The bank charged a $10 collection fee. No interest has been accrued.
3. Outstanding checks at May 31 total $2,410.
4. Deposits in transit at May 31 total $1,752.
5. A Poorten Company check for $352, dated May 10, cleared the bank on May 25. The company recorded this check, which was a payment on account, for $325.
Instructions

(a) Prepare a bank reconciliation at May 31.

(b) Journalize the entries required by the reconciliation.

Transcribed Image Text:

Balance 5/1 Debit memorandum: NSF check $12,650 $175 Balance 5/31 $14,280 Credit memorandum: Collection of note receivable $505