Rick Rambis operates a ski lodge center at Bull Mountain in Alaska. He has just received the monthly bank statement at October 31 from Bull National Bank. The bank statement shows an ending balance at October 31 of $750. The following items are listed on the statement: 1. The bank collected rent revenue for Rick in the amount of $330. 2. Service charge of $10. 3. Two NSF checks from customers totaling $110. 4. Printing check charge of $11. In reviewing his cash records and the bank statement, Rick identifies the following: 1. Outstanding checks totaling $603. 2. Deposit in transit on October 31 of $1,770. 3. An error made by Rick: Rick recorded a salary check for $31 but it cleared the bank at $310. Rick’s cash records show a balance on October 31 of $1,997. Required a) Reconcile the bank account. b) Prepare journal entries that should be made as a result of the bank reconciliation. c) What should the balance in Rick’s Cash account be after the reconciliation?
Rick Rambis operates a ski lodge center at Bull Mountain in Alaska. He has just received the
monthly bank statement at October 31 from Bull National Bank. The bank statement shows an
ending balance at October 31 of $750. The following items are listed on the statement:
1. The bank collected rent revenue for Rick in the amount of $330.
2. Service charge of $10.
3. Two NSF checks from customers totaling $110.
4. Printing check charge of $11.
In reviewing his cash records and the bank statement, Rick identifies the following:
1. Outstanding checks totaling $603.
2. Deposit in transit on October 31 of $1,770.
3. An error made by Rick: Rick recorded a salary check for $31 but it cleared the bank at
$310.
Rick’s cash records show a balance on October 31 of $1,997.
Required
a) Reconcile the bank account.
b) Prepare
c) What should the balance in Rick’s Cash account be after the reconciliation?
d) What total amount of cash should the company report on the October 31 balance sheet?
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