Bank Reconciliation and Entries

The cash account for Pala Medical Co. at June 30, 20Y1,indicated a balance of $13,015. The bank statement indicated abalance of $15,420 on June 30, 20Y1. Comparing the bank statementand the accompanying canceled checks and memos with the recordsrevealed the following reconciling items:

1. Checks outstanding totaled $5,550.
2. A deposit of $5,780, representing receipts of June 30, had beenmade too late to appear on the bank statement.
3. The bank collected $3,010 on a $2,850 note, including interestof $160.
4. A check for $660 returned with the statement had beenincorrectly recorded by Pala Medical Co. as $600. The check was forthe payment of an obligation to Skyline Supply Co. for a purchaseon account.
5. A check drawn for $30 had been erroneously charged by the bankas $300.
6. Bank service charges for June amounted to $45.

Required:

1. Prepare a bank reconciliation.

Pala Medical Co.
Bank Reconciliation
June 30, 20Y1
Cash balance according to bank statement		$
Adjustments:
	$
Total adjustments
Adjusted balance		$
Cash balance according to company's records		$
Adjustments:
	$
Total adjustments
Adjusted balance		$

2. Journalize the necessary entries (a.) thatincrease cash and (b.) that decrease cash. The accounts have notbeen closed. For a compound transaction, if an amount box does notrequire an entry, leave it blank.

a. 20Y1 June 30
b. June 30

3. If a balance sheet were prepared for PalaMedical Co. on June 30, 20Y1, what amount should be reported ascash?
$