The bank portion of last month's bank reconciliation showed the following for River Adventures Ltd.:

The adjusted cash balance per bank agreed with the cash balance per books after the bank reconciliation at April 30. The May bank statement showed the following:

River Adventures' cash receipts and payments for the month of May showed the following:

Additional information:
1. The bank made an error when processing cheque #543.
2. The EFT collection was not previously recorded.
3. Because the EFT for prepaid insurance payment occurred near the end of the month, it has not been recorded yet.
Instructions
(a) Calculate the unadjusted cash balance per books at May 31, prior to reconciliation.
(b) What is the amount of the deposits in transit at May 31?
(c) What is the amount of the outstanding cheques at May 31?
(d) Prepare the bank reconciliation at May 31.
(e) Prepare any adjusting journal entries required from the reconciliation.

Transcribed Image Text:

RIVER ADVENTURES LTD Bank Reconciliation April 30 Cash balance per bank Add: Deposits in transit $9,009 846 9,855 Less: Outstanding cheques #533 #541 $279 303 642 Adjusted cash balance $9,213 RIVER ADVENTURES LTD. Bank Statement May 31 Amounts Deducted from Account (Debits) Amounts Added to Account (Credits) Balanc 9,009 9,855 9,492 9,213 7,413 8,663 7,103 7,753 6,954 8,725 8,285 8,245 7,667 7,592 7,567 Date Apr. 30 Openg balance May Deposit Description 3 Cheque, No. 541 363 279 1,800 4 Cheque, No. 533 6 Cheque, No. 542 6 Deposit 10 Cheque, No. 543 18 EFT, collection on account from A. Osborne 19 Cheque, No. 544 28 Deposit 28 Returned cheque-NSE R. Lajeunesse 28 NSF fee 30 EFT, prepaid insurance payment 31 Debit and credit card fees 3 Bank service charges 1,250 650 1,771 9 1,560 5 2 Cash Receipts Cash Payments Date Amount $1,250 1,771 1,286 $4,307 Number 542 543 544 545 Amount 1,800 1,650 799 950 $5,199 May6 28 31 May5 15 31