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E8-11 Prepare bank reconciliation and adjusting entries
The following information pertains to Crane Video Company.
1 Cash balance per bank, July 31, $7,263.
2 July bank service charge not recorded by the depositor $28.
3 Cash balance per books, July 31, $7,284.
4 Deposits in transit, July 31, $1,300.
5 Bank collected $700 note for Crane in July, plus interest $36, less fee $20. The
collection has not been recorded by Crane, and no interest has been accrued.
6
Outstanding checks, July 31, $591.
Instructions
(a) Prepare a bank reconciliation at July 31.
(b) Journalize the adjusting entries at July 31 on the books of Crane Video Company.
NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" .
(a) Prepare a bank reconciliation at July 31.
Value
Add: Value
?
Less: Value
Adjusted cash balance per bank ?
Value
Add: Value
?
Less: Value
Adjusted cash balance per books ?
(b) Journalize the adjusting entries at July 31 on the books of Crane Video Company.
Jul 31 Value
Value Value
Value
31 Account Value
Account Value
After you have completed the requirements of E8-11, consider these additional questions.
Answers are on the other tab in this file.
1. Assume deposits in transit changed to $1,600. What would be the new adjusted cash balance per bank?
2 Using the new adjusted cash balance per bank in (1) above, what would the balance per books be before adjustments?
July 31
Bank Reconciliation
CRANE VIDEO COMPANY
Account
Account
Cash balance per bank statement
Cash balance per books
Account
Account
Ex8-11 Solution
(a) Prepare a bank reconciliation at July 31.
7,263$
Add: 1,300
8,563
Less: 591
Adjusted cash balance per bank 7,972$
(b) Journalize the adjusting entries at July 31 on the books of Crane Video Company.
Jul 31 Cash 716
CRANE VIDEO COMPANY
Bank Reconciliation
July 31
Cash balance per bank statement
Deposits in transit
Outstanding checks
Ex 8-11 Solution to Additional Questions
1. Assume deposits in transit changed to $1,600. What would be the new adjusted cash balance per bank?
(a) Prepare a bank reconciliation at July 31.
7,263$
Add:
1,600
2. Using the new adjusted cash balance per bank in (1) above, what would the balance per books be before adjustments?
(b) Journalize the adjusting entries at July 31 on the books of Crane Video Company.
$7,584
Cash balance per bank statement
Deposits in transit
Cash balance per books
Collection of note receivable ($700
CRANE VIDEO COMPANY
Bank Reconciliation
July 31
Ex 8-12 Prepare bank reconciliation and adjusting entries
The information below relates to the Cash account in the ledger of Minton Company.
Balance September 1 - $17,150, Cash deposited - $64,000.
Balance September 30 - $17,404; Checks written - $63,746.
The September bank statement shows a balance of $16,422 on September 30 and the following memoranda.
$2,530 NSF check: Richard Nance $425
$45 Safety deposit box rent $65
At September 30, deposits in transit were $5,450 and outstanding checks totaled $2,383.
Instructions:
(a) Prepare the bank reconciliation at September 30
(b) Prepare the adjusting entries at September 30, assuming (1) the NSF check was from a
customer on account, and (2) no interest had been accrued on the note.
NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" .
(a) Prepare the bank reconciliation at September 30
Value
Add: Value
?
Less: Value
Adjusted cash balance per bank ?
Value
Add: Value
Value ?
?
Less: Value
Value Value
Adjusted cash balance per books ?
(b) Prepare the adjusting entries at September 30, assuming (1) the NSF check was from a
customer on account, and (2) no interest had been accrued on the note.
Sept 30 Value
Value
Value
30 Value
Value
30 Value
Value
30 Value
Value
After you have completed the requirements of E8-12, consider the additional question.
1. Assume deposits in transit changed to $5,000 and NSF check changed to $875. What would be the impact on adjusted cash balance per bank and books?
Credits
Debits
Collection of $2,500 note plus interest $30
Interest earned on checking account
Account
Account
MINTON COMPANY
Bank Reconciliation
September 30
Account
Account
Cash balance per bank statement
Deposits in transit
Outstanding checks
Cash balance per books
Account
Account
Account
Account
Account
Ex8-12 Solution
(a)
16,422$
Add: 5,450
(b) Sept.30 Cash 2,530 2500
30
MINTON COMPANY
Bank Reconciliation
September 30
Note Receivable
Cash balance per bank statement
Deposits in transit
Interest Revenue
Ex 8-12 Solution to Additional Question
1. Assume deposits in transit changed to $5,000 and NSF check changed to $875. What would be the impact on adjusted cash balance per bank and books?
(a) Prepare the bank reconciliation at September 30
$16,422
Add: 5,000
21,422
17,404$
Add: $ 2,530
Cash balance per books
Collection of note receivable
($2,500 +$30)
MINTON COMPANY
Bank Reconciliation
September 30
Cash balance per bank statement
Deposits in transit
