60.1K

Verified Solution

Link Copied!

image

Infinity Emporium Company received the monthly statement for its bank account, showing a balance of $$67,000$ on August $31.$ The balance in the Cash account in the company's accounting system at that date was $$73,928.$ The company's accountant reviewed the statement and the company's accounting records and noted the following.

After comparing the cheques written by the company with those deducted from the bank account in August, the accountant determined that all six cheques $($totalling $$6\mathrm{.}180)$ that had been outstanding at the end of July were processed by the bank in August. However, five cheques written in August, totalling $$4,700,$ were outstanding on August $31.$

A review of the deposits showed that a deposit made by the company on July $31$ for $$11,532$ was recorded by the bank on August $1,$ and an August $31$ deposit of $$14,000$ was recorded in the company's accounting system but had not yet been recorded by the bank.

The August bank statement also showed:

a service fee of $$24$

a customer's cheque in the amount of $$204$ that had been returned NSF

a bank loan payment of $$1,400,$ which included interest of $$130,$ that the bank had deducted automatically

a customer's paid $$4,000$ account balance by electronic transfer.

Prepare a bank reconciliation as at August $31.($Hint: Items that were outstanding last month but have been processed this month should no longer affect the bank reconciliation, since both the company and the bank now have them recorded.$)($List items that increase balance as per banic & books first.$)$

Infinity Emporium Company

Bank Reconciliation

As of August $31$

$ $$

$$

$$

$$

$$

$$

$$

$

Answer & Explanation Solved by verified expert

See Answer