R-Enterprise, a real estate dealer, has a Cash account in the general ledger showing a balance...

  

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R-Enterprise, a real estate dealer, has a Cash account in the general ledger showing a balance of $25,380 at December 31, 2020 (prior to performing bank reconciliation). On the same date, the balance as per the company's bank statement is $30,000. A detailed review of the bank statement discloses the following: 1. Deposit in transit from November 30th bank reconciliation amounts to $3,000. 2. The deposit in transit on December 31st amount to $8,500. 3. Bank service charges total $450. 4. Outstanding checks amounting to $20,100 from November 30th bank reconciliation were cashed during December. 5. Outstanding checks on December 31st total $28,500. 6. The bank statement showed an NSF charge of $800 for a check issued by a customer to R-Enterprise's on account. 7. A cashed check (no. 108) written by the company in the amount of $3,260 for office supplies was incorrectly recorded in the cash ledger as a debit to supplies of $3,620, and a credit to Cash of $3,620. 8. Bank statement had a CM of $2,610. Required a. Prepare the company's bank reconciliation dated December 31, 2020. (10 points, 15 minutes) b. Prepare the journal entries to reconcile the books. (8 points, 10 minutes) Solution (a). Balance per Bank Statement Balance per Book $30,000 $25,380 Add: Less: Reconciled value Add: Less: Reconciled value: R-Enterprise, a real estate dealer, has a Cash account in the general ledger showing a balance of $25,380 at December 31, 2020 (prior to performing bank reconciliation). On the same date, the balance as per the company's bank statement is $30,000. A detailed review of the bank statement discloses the following: 1. Deposit in transit from November 30th bank reconciliation amounts to $3,000. 2. The deposit in transit on December 31st amount to $8,500. 3. Bank service charges total $450. 4. Outstanding checks amounting to $20,100 from November 30th bank reconciliation were cashed during December. 5. Outstanding checks on December 31st total $28,500. 6. The bank statement showed an NSF charge of $800 for a check issued by a customer to R-Enterprise's on account. 7. A cashed check (no. 108) written by the company in the amount of $3,260 for office supplies was incorrectly recorded in the cash ledger as a debit to supplies of $3,620, and a credit to Cash of $3,620. 8. Bank statement had a CM of $2,610. Required a. Prepare the company's bank reconciliation dated December 31, 2020. (10 points, 15 minutes) b. Prepare the journal entries to reconcile the books. (8 points, 10 minutes) Solution (a). Balance per Bank Statement Balance per Book $30,000 $25,380 Add: Less: Reconciled value Add: Less: Reconciled value:

Answer rating: 100% (QA)

Solution 1 2 Balance as per Bank statement Add Deposit in trans... View the full answer