Using the following information, prepare a bank reconciliation.
• Bank balance: $12,565.
• Book balance: $13,744.
• Deposits in transit: $2,509.
• Outstanding checks: $1,777.
• Bank charges: $125.
• Bank incorrectly charged the account for $412. The bank will correct the error next month.
• Check number 1879 correctly cleared the bank in the amount of $562 but posted in the accounting records as $652. This check was expensed to Utilities Expense.