Problem $8-4$B

Preparing a bank reconciliation and recording entries

P$3$

The following information is available to reconcile Severino Co$.$s book balance of cash with its bank statement cash balance as of December $31.$

a$.$ The December $31$ cash balance according to the accounting records is $$32,878\mathrm{.}30,$ and the bank statement cash balance for that date is $$46,822\mathrm{.}40.$

b$.$ Check No$.1242$ for $$410\mathrm{.}40,$ Check No$.1273$ for $$4,589\mathrm{.}30,$ and Check No$.1282$ for $$400$ are outstanding checks as of December $31.$

c$.$ Check No$.1267$ had been correctly drawn for $$3,456$ to pay for office supplies but was erroneously entered in the accounting records as $$3,465.$

d$.$ The bank statement shows a $$762\mathrm{.}50$ NSF check received from a customer, Titus Industries, in payment of its account. The statement also shows a $$99$ bank fee in miscellaneous expenses for check printing. Severino had not yet recorded these transactions.

e$.$ The bank statement shows that the bank collected $$18,980$ cash on a note receivable for the company. Severino did not record this transaction before receiving the statement.

f$.$ Severino$$s December $31$ daily cash receipts of $$9,583\mathrm{.}10$ were placed in the bank$$s night depository on that date but do not appear on the December $31$ bank statement.

Required!!!

$1.$Prepare the bank reconciliation for this company as of December $31.$

$2.$Prepare the journal entries necessary to make the company$$s book balance of cash equal to the reconciled cash balance as of December $31.$

Check $(1)$ Reconciled balance, $$51,005\mathrm{.}80$; $(2)$ Cr$.$ Notes Receivable, $$18,980\mathrm{.}00$ Alexander Image$/$Shutterstock

SP $8$ Santana Rey receives the March bank statement for Business Solutions on April $11,2022.$ The March $31$ bank statement shows an ending cash balance of $\backslash (\backslash$$ $67,566\backslash ).$ The general ledger Cash account, No$.101,$ shows an ending cash balance per books of $\backslash (\backslash$$ $68,057\backslash )$ as of March $31($prior to any reconciliation$).$ A comparison of the bank statement with the general ledger Cash account, No$.101,$ reveals the following.

a$.$ The bank erroneously cleared a $\backslash (\backslash$$ $500\backslash )$ check against the company account in March that S$.$ Rey did not issue. The check was actually issued by Business Systems.

b$.$ On March $25,$ the bank statement lists a $\backslash (\backslash$$ $50\backslash )$ charge for a safety deposit box. Santana has not yet recorded this expense.

c$.$ On March $26,$ the bank statement lists a $\backslash (\backslash$$ $102\backslash )$ charge for printed checks that Business Solutions ordered from the bank. Santana has not yet recorded this expense.

d$.$ On March $31,$ the bank statement lists $\backslash (\backslash$$ $33\backslash )$ interest earned on Business Solutions's checking account for the month of March. Santana has not yet recorded this revenue.

e$.$ S$.$ Rey notices that the check she issued for $\backslash (\backslash$$ $128\backslash )$ on March $31,2022,$ has not yet cleared the bank.

f$.$ S$.$ Rey verifies that all deposits made in March do appear on the March bank statement.

Required

$1.$ Prepare a bank reconciliation for Business Solutions for the month ended March $31,2022.$

Check $(1)$ Adj. bank bal., $\backslash$$$67,938$

$2.$ Prepare any necessary entries. Use Miscellaneous Expenses, No$.677,$ for any bank charges. Use Interest Revenue, No$.404,$ for any interest earned on the checking account for March.