Harrison Company maintains a checking account at the FirstNational City Bank. The bank provides a bank statement along withcanceled checks on the last day of each month. The July 2021 bankstatement included the following information:
| | | |
| Balance, July 1, 2021 | $ | 56,803 | |
| Deposits | | 180,400 | |
| Checks processed | | (193,510 | ) |
| Service charges | | (75 | ) |
| NSF checks | | (1,650 | ) |
Monthly payment on note, deducted directly by bank fromaccount
(includes $870 in interest) | | (3,770 | ) |
| Balance, July 31, 2021 | $ | 38,198 | |
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The company’s general ledger account had a balance of $40,448 atthe end of July. Deposits outstanding totaled $7,200 and all checkswritten by the company were processed by the bank except for thosetotaling $8,510. In addition, a $2,900 July deposit from a creditcustomer was recorded as a $290 debit to cash and credit toaccounts receivable, and a check correctly recorded by the companyas a $75 disbursement was incorrectly processed by the bank as a$750 disbursement.
Required:
1. Prepare a bank reconciliation for the month ofJuly.
2. Prepare the necessary journal entries at theend of July to adjust the general ledger cash account.
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| | | Bank Balance to Corrected Balance | | Balance per bank statement | | | | | | | | | | | Corrected cash balance | | | Book Balance to Corrected Balance | | Balance per books | | | | | | | | | | | | | Corrected cash balance |
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Prepare the necessary journal entries at the end of July toadjust the general ledger cash account. (If no entry is requiredfor a transaction/event, select "No journal entry required" in thefirst account field.)
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| | Event | General Journal | Debit | Credit |
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| 1 | | | | | | | | | | | | | | | | | | | | | | |
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Record the credits to cash revealed by the bank reconciliation.Use the miscellaneous expense account to record the bank servicecharges.
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| | Event | General Journal | Debit | Credit |
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| 2 | | | | | | | | | | | | | | | | | | | | | | | | | | |
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