BUSINESS

Problem 4-3A Prepare the bank reconciliation and record cash adjustments (LO5)

[The following information applies to the questions displayed below.]

The cash records and bank statement for the month of May for Diaz Entertainment are shown below.

 

DIAZ ENTERTAINMENT
Cash Account Records
May 1, 2015, to May 31, 2015
Cash Balance
May 1, 2015
+ Deposits Checks = Cash Balance
May 31, 2015




$5,280 $12,040 $12,220 $5,100
Deposits Checks


Date Desc. Amount Date No. Desc. Amount







   5/3 Sales $  1,460    5/7 471     Legal fees $  1,300
   5/10 Sales 1,890    5/12 472     Property tax 1,670
   5/17 Sales 2,520    5/15 473     Salaries 3,600
   5/24 Sales 2,990    5/22 474     Advertising 1,500
   5/31 Sales 3,180    5/30 475     Supplies 550
   5/31 476     Salaries 3,600


$12,040 $12,220





 

   P.O. Box 162647
Bowlegs, OK 74830
(405) 369-CASH
MIDWEST BANK
Looking Out For You
Member FDIC
  Account Holder:      Diaz Entertainment
124 Saddle Blvd.
Bowlegs, OK 74830
Account Number:

Statement Date:

7772854360

May 31, 2015





Beginning Balance Deposits and Credits Withdrawals
and Debits
Ending Balance


May 1, 2015 No. Total No. Total May 31, 2015







$ 6,260 7 $ 10,050 9 $ 10,100 $ 6,210
Deposits and Credits Withdrawals and Debits Daily Balance



Date Amount Desc. Date No. Amount Desc. Date Amount









     5/4 $ 1,460     DEP      5/1 469 $  550   CHK      5/1 $ 5,710
     5/11 1,890     DEP      5/2 470 430   CHK      5/2 5,280
     5/18 2,520     DEP      5/9 471 1,300   CHK      5/4 6,740
     5/20 1,100     NOTE      5/11 400   NSF      5/9 5,440
     5/20 60     INT      5/12 472 1,670   CHK      5/11 6,930
     5/25 2,990     DEP      5/18 473 3,600   CHK      5/12 5,260
     5/31 30     INT      5/20 600   EFT      5/18 4,180
     5/25 474 1,500   CHK      5/20 4,740
     5/31 50   SF      5/25 6,230


     5/31 $ 6,210
$ 10,050 $10,100





 

Desc. DEP Customer deposit INT Interest earned SF Service fees
NOTE Note collected CHK Customer check NSF Nonsufficient funds
EFT Electronic funds transfer

 

     Additional information:
a. The difference in the beginning balances in the company’s records and the bank statement relates to checks #469 and #470, which are outstanding as of April 30, 2015.
b. The bank made the EFT on May 20 in error. The bank accidentally charged Diaz for payment that should have been made on another account.

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