The bank statement for Rodney’s Lawn Maintenance had an ending balance as of October 31 of $25,450.85. Also listed on the statement was a service charge for $21. Check 1825, which Rodney wrote to pay for equipment purchased October 30, had not cleared the bank yet—the amount was $5,415. Deposits in transit were $7,850.25. Rodney’s bank collected a $1,275 note for him in October. After reviewing the bank statement and the canceled checks, Rodney discovered that the bank mistakenly deducted $1,875.93 from his account on a check that was written by Rogers’ Lawn Maintenance.
Calculate the true cash balance as of October 31 and tell where it would be reported on the financial statements.