The cash account of Pronghorn Corp. shows a general ledger balance of $3,958.95 on June 30, 2023. The bank statement as at that date shows a balance of $4,280. When the statement was compared with the cash records, the following facts were determined: 1. 2. 3. 4. 5. 6. 7. 8. (a) There were bank service charges for June of $25.00. A bank memo stated that a note from Bao Dai for $950 and interest of $36 had been collected on June 29, and the bank had made a charge of $8.00 on the collection. (No entry had been made on Pronghorn's books when Bao Dai's note was sent to the bank for collection.) Receipts for June 30 of $2,810 were not deposited until July 2. Cheques outstanding on June 30 totalled $2,137.05. On June 29, the bank had charged Pronghorn's account for a customer's NSF cheque amounting to $454.80. A customer's cheque for $100 had been entered as $65 in the cash receipts journal by Pronghorn on June 15 as a collection on account. Cheque no. 742 in the amount of $481 had been entered in the cash book as $418, and cheque no. 747 in the amount of $58.20 had been entered as $582. Both cheques were issued to pay for cash purchases of equipment. In May 2023, the bank had charged a $26.50 Monty Corp. cheque against the Pronghorn Corp. account. The June bank statement showed that the bank had reversed this charge and corrected its error.
The cash account of Pronghorn Corp. shows a general ledger balance of $3,958.95 on June 30, 2023. The bank statement as at that date shows a balance of $4,280. When the statement was compared with the cash records, the following facts were determined: 1. 2. 3. 4. 5. 6. 7. 8. (a) There were bank service charges for June of $25.00. A bank memo stated that a note from Bao Dai for $950 and interest of $36 had been collected on June 29, and the bank had made a charge of $8.00 on the collection. (No entry had been made on Pronghorn's books when Bao Dai's note was sent to the bank for collection.) Receipts for June 30 of $2,810 were not deposited until July 2. Cheques outstanding on June 30 totalled $2,137.05. On June 29, the bank had charged Pronghorn's account for a customer's NSF cheque amounting to $454.80. A customer's cheque for $100 had been entered as $65 in the cash receipts journal by Pronghorn on June 15 as a collection on account. Cheque no. 742 in the amount of $481 had been entered in the cash book as $418, and cheque no. 747 in the amount of $58.20 had been entered as $582. Both cheques were issued to pay for cash purchases of equipment. In May 2023, the bank had charged a $26.50 Monty Corp. cheque against the Pronghorn Corp. account. The June bank statement showed that the bank had reversed this charge and corrected its error.
College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:Scott, Cathy J.
Chapter6: Bank Accounts, Cash Funds, And Internal Controls
Section: Chapter Questions
Problem 5E
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Transcribed Image Text:The cash account of Pronghorn Corp. shows a general ledger balance of $3,958.95 on June 30, 2023. The bank statement as at that
date shows a balance of $4,280. When the statement was compared with the cash records, the following facts were determined:
1.
2.
3.
4.
5.
6.
7.
8.
(a)
There were bank service charges for June of $25.00.
A bank memo stated that a note from Bao Dai for $950 and interest of $36 had been collected on June 29, and the bank had
made a charge of $8.00 on the collection. (No entry had been made on Pronghorn's books when Bao Dai's note was sent to
the bank for collection.)
Receipts for June 30 of $2,810 were not deposited until July 2.
Cheques outstanding on June 30 totalled $2,137.05.
On June 29, the bank had charged Pronghorn's account for a customer's NSF cheque amounting to $454.80.
A customer's cheque for $100 had been entered as $65 in the cash receipts journal by Pronghorn on June 15 as a collection
on account.
Cheque no. 742 in the amount of $481 had been entered in the cash book as $418, and cheque no. 747 in the amount of
$58.20 had been entered as $582. Both cheques were issued to pay for cash purchases of equipment.
In May 2023, the bank had charged a $26.50 Monty Corp. cheque against the Pronghorn Corp. account. The June bank
statement showed that the bank had reversed this charge and corrected its error.
Prepare a bank reconciliation dated June 30, 2023, proceeding to a correct cash balance. (List items that increase balance as per
bank & books first.)
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