Unruh Company received a bank statement for the month of October 2011, which showed a balance per bank of $3,600. The company's Cash account in the general ledger showed a balance of $1,204 at October 31.
Other information that may be relevant in preparing a bank reconciliation for October follows:
1. The bank returned an NSF check from a customer for $280.
2. The company recorded cash receipts of $250 on October 31 but this amount does not appear on the bank statement.
3. A check correctly written by Unruh and paid by the bank for $1,740 was incorrectly recorded in the cash payments journal for $1,470. The check was a payment on account.
4. Checks which were written in September but still had not been presented to the bank for payment at October 31 amounted to $780.
5. The bank included a credit memorandum for $1,236, which represents a collection of a customer's note by the bank for the company; principal amount of the note was $1,200 and the remainder was interest.
6. The bank included a $20 debit memorandum for service charges for the month of October.
7. Checks written in October which have not been paid by the bank at October 31 amounted to $1,200.
Instructions
1. Prepare bank reconciliation for Unruh Company for October which reconciles the balance per books and the balance per bank to their adjusted correct balances.
2. Prepare the necessary adjusting entries for Unruh Company at October 31, 2011.