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Problem 7-9A Preparing a bank reconciliation and recording adjustments LO6 Stewart Recording Studio, owned by Ron Stewart, showed the following bank reconciliation at March 31: Stewart Recording Studio Bank Reconciliation March 31, 2020 $21,800 Book balance $30,525 Bank statement balance Add: Deposit of March 31 in transit 9,862 $31,662 Deduct: Outstanding cheques : #14 #22 Adjusted bank balance $822 315 1,137 $30,525 Adjusted book balance $30,525 Cash Explanation Acct. No. 101 Balance PR Debit Credit Date 2020 March April Balance 31 30 30 CR17 CD13 71,203 30,525 101,728 11,423 90, 305 A list of deposits made and cheques written during April, taken from the Cash Receipts Journal and Cash Disbursements Journal, is shown below: Deposits Made April 7 13 18 23 27 30 $ 687 4,579 5,876 13,841 1,745 44,475 $71,203 Total April Cash Receipts Cheques Written No. 23 24 25 26 27 28 29 30 31 32 Total April Cash Disbursements $ 5,178 3,138 936 307 4, 189 4,900 19,419 40,510 409 11, 319 $90, 305 The following bank statement is available for April: Bank Statement To: Stewart Recording Studio Cheques/Charges Deposits/Credits 409 9,400 04/03 04/07 04/13 04/18 #31 04/03 #28 04/07 #26 04/13 NSF 04/18 #24 04/23 #23 04/27 #29 #29 04/30 PMT 04/30 INT 04/30 SC 04/30 NSF = Not Sufficient Funds 9,862 687 4,579 5,876 13,841 1,745 117,000 04/23 April 30, 2020 Bank of Canada Balance 21,800 31,253 22,540 26,812 20,012 18,630 29,333 25,900 123,481 107,755 107,331 107,154 INT = Interest on Bank Loan 307 14,058 458 3,138 5,178 19,419 15,726 424 177 SC = Service Charge 04/27 04/30 PMT = Payment of Principal on the loan In reviewing cheques returned by the bank, the bookkeeper discovered that cheque #28, for delivery expense, was recorded in the Cash Disbursements Journal correctly as $4,900. The NSF cheque for $14,058 was that of customer Oprah Winney, deposited in March . On the bank statement, the payment for $15,726 is regarding a note payable. There is also a deposit of $117.000 dated April 30. It is an investment made by the owner into the business (the bank transferred the funds electronically from the owner's personal account to his business account, which is why it was not recorded in the Cash Receipts Journal). Required: a. Prepare a bank reconciliation for Stewart Recording Studio at April 30. STEWART RECORDING STUDIO Bank Reconciliation April 30, 2020 Bank Statement Company's Books Bank statement balance Book balance Add: Add: 0 0 Deduct: Deduct: Outstanding cheques 0 Adjusted bank balance Adjusted book balance b. Prepare the necessary journal entries to bring the General Ledger Cash account into agreement with the adjusted balance on the bank reconciliation View transaction list Journal entry worksheet Record to reinstate customer account. Note: Enter debits before credits. Date General Journal Debit Credit Apr 30 Record entry Clear entry View general journal

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