Part 1: Prepare a bank reconciliation for may. Part 2: 1. Record the interest of $110 receipt from the bank. 2. Record the return of the customer check of $260 due to insufficient funds. 3. Record the service charges of $70 deducted by the bank. Part 3: 1. After the reconciliation journal entries are posted what balance will be reflected in the cash amount in the ledger? 2.  4. If the company also has $60 of petty cash on hand, which is recorded in a different account called Petty Cash on Hand, what totall amount of Cash and Cash Equivalents should be reported on the balance sheet at the end of May?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Part 1: Prepare a bank reconciliation for may. Part 2: 1. Record the interest of $110 receipt from the bank. 2. Record the return of the customer check of $260 due to insufficient funds. 3. Record the service charges of $70 deducted by the bank. Part 3: 1. After the reconciliation journal entries are posted what balance will be reflected in the cash amount in the ledger? 2.  4. If the company also has $60 of petty cash on hand, which is recorded in a different account called Petty Cash on Hand, what totall amount of Cash and Cash Equivalents should be reported on the balance sheet at the end of May?
Required information
PA5-2 (Algo) Preparing a Bank Reconciliation and Journal Entries and Reporting Cash [LO 5-4, LO 5-5]
[The following information applies to the questions displayed below.]
The bookkeeper at Martin Company has asked you to prepare a bank reconciliation as of May 31. The May 31 bank
statement and the May T-account for cash (summarized) are below.
Martin Company's bank reconciliation at the end of April showed a cash balance of $17,900. No deposits were in transit at
the end of April, but a deposit was in transit at the end of May.
Checks
BANK STATEMENT
Deposits
Other
Balance
Balance, May 1
May 2
$ 7,000
May 5
$ 17,900
24,900
14,900
May 7
May 8
9,300
9,000
May 14
18,300
17,820
May 17
17,930
May 22
17,670
May 27
13,270
May 31
13,200
Balance, May 31
13,200
May 1
May 1
May 7
May 29
May 31
Debit
Balance
Balance
**
# 301
# 302
#303
# 304
$ 10,000
5,600
480
4,400
Cash (A)
17,900
7,000
9,000
5,600
17,920
10,000
5,600
480
4,400
1,100
Interest earned
NSF check
Service charge
# 301 May 2
#302 May 4
# 303 May 11
# 304 May 23
#305 May 29
Credit
8 of 10
‒‒‒
▪▪▪
$ 110
260
70
Next >
Transcribed Image Text:Required information PA5-2 (Algo) Preparing a Bank Reconciliation and Journal Entries and Reporting Cash [LO 5-4, LO 5-5] [The following information applies to the questions displayed below.] The bookkeeper at Martin Company has asked you to prepare a bank reconciliation as of May 31. The May 31 bank statement and the May T-account for cash (summarized) are below. Martin Company's bank reconciliation at the end of April showed a cash balance of $17,900. No deposits were in transit at the end of April, but a deposit was in transit at the end of May. Checks BANK STATEMENT Deposits Other Balance Balance, May 1 May 2 $ 7,000 May 5 $ 17,900 24,900 14,900 May 7 May 8 9,300 9,000 May 14 18,300 17,820 May 17 17,930 May 22 17,670 May 27 13,270 May 31 13,200 Balance, May 31 13,200 May 1 May 1 May 7 May 29 May 31 Debit Balance Balance ** # 301 # 302 #303 # 304 $ 10,000 5,600 480 4,400 Cash (A) 17,900 7,000 9,000 5,600 17,920 10,000 5,600 480 4,400 1,100 Interest earned NSF check Service charge # 301 May 2 #302 May 4 # 303 May 11 # 304 May 23 #305 May 29 Credit 8 of 10 ‒‒‒ ▪▪▪ $ 110 260 70 Next >
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