Can someone please identify the errors in the following bank reconciliation?Cash according to bank statement 11,320 Add: outstanding checks 2,690 Total $14,010 Deduct: deposit of April 30, not...

Can someone please identify the errors in the following bank reconciliation?

Cash according to bank statement 11,320 Add: outstanding checks 2,690 Total $14,010 Deduct: deposit of April 30, not recorded by bank $3,330 Adjusted balance $10,680 Cash according to company's records $7,003 Add: Proceeds of note collected by bank: Principal $4,000 Interest 120 $4,120 Service charge 18 $4,138 Total $11,141 Deduct: Check returned because of insufficient funds $ 945 Error in recording April 20 deposit of $5,300 as $3,500 $1,800 2,745 Adjusted balance $ 8,396

Asked on by linnie4352

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hustoncmk | High School Teacher | (Level 1) Assistant Educator

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The correct bank reconciliation should be as follows:

Cash according to the bank statement:     $11,320

less outstanding checks:                            -   2,690

add deposits not yet recorded:                  +  3,330

                                                                   ________

Correct cash balance                                 $11,960

                                                                ==========

Cash balance according to the books         $ 7,003

add: note collected by the bank   $4,000

      interest collected by the bank      120

less: bank service fee for note          -  18

net note proceeds                                           4,108

less check returned NSF funds                       -    945

add error in recording deposit                       + 1,800

                                                                    _______

Correct cash balance                                    $11,960

                                                                    =======

I hope this helps you see where the errors were made. 

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