The cash account for Freds Sports Co. on June 1, 2010, indicated a balance of $16,515. During


The cash account for Fred’s Sports Co. on June 1, 2010, indicated a balance of $16,515. During June, the total cash deposited was $40,150, and checks written totaled $43,600. The bank statement indicated a balance of $18,175 on June 30, 2010. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items:
a. Checks outstanding totaled $6,840.
b. A deposit of $4,275, representing receipts of June 30, had been made too late to appear on the bank statement.
c. A check for $640 had been incorrectly charged by the bank as $460.
d. A check for $80 returned with the statement had been recorded by Fred’s Sports Co. as $800. The check was for the payment of an obligation to Miliski Co. on account.
e. The bank had collected for Fred’s Sports Co. $3,240 on a note left for collection. The face of the note was $3,000.
f. Bank service charges for June amounted to $35.
g. A check for $1,560 from ChimTech Co. was returned by the bank because of insufficient funds.
1. Prepare a bank reconciliation as of June 30.
2. Illustrate the effects on the accounts and financial statements of the bank reconciliation.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
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