Question 2 BankReconciliation

The Duluth Manufacturing Company has a business chequing accountat the Bank of Ontario. The bank provides a bank statement andcancelled cheques once a month. The cut-off date is the last day ofthe month. The bank statement for the month of May is summarized asfollows:

Balance, May 1,2016                                         $32,120

      Deposits                                             82,140

       Chequesprocessed                                      (78,433)

       Servicecharges                                     (80)

       NSF cheque fromcustomer                                            (2,187)

       Note payment collected bybank (includes $120 interest)         1,120

Balance May 31,2016                                               $34,680

The company’s general ledger cash account has a balance of$35,276 at the end of May. A review of the company records and thebank statement reveals the following:

1. Cash receipts not yet deposited total $2,965.

2. A deposit of $1,020 was made on May 31 that will not becredited to the company’s account until June.

3. All cheques written in April have been processed by the bank.Cheques written in May that have not been   processed by the bank total $5,536.

4. A cheque written for $1,790 was incorrectly recorded by thecompany as a $790 disbursement. The original Accounts Payable was$1,790.

Required:

a. Prepare the bank reconciliation for the month of May.

b. Prepare the journal entries required to adjust the generalledger cash account to actual.