Reconcile the bank account-
The following information is available to reconcile ACME company’s book balance of cash with its bank statement cash balance of January 31, 2019:
- After posting is complete, the January 31 cash balance according to the accounting records is $34,522.22, and the bank statement cash balance for that date is $49,163.52.
- Check No. 1373 for $4,818.77 and Check No. 1282 for $420, both written and entered in the accounting records in January, are not among the canceled checks. Two checks, No. 1230 for $2,403.45 and No. 1242 for $430.92, were outstanding on the most recent December 31 reconciliation. Check No. 1230 is listed with the January canceled checks, but the Check No. 1242 is not.
- When the January checks are compared with the entries in the accounting records, it is found that Check No. 1369 had been correctly drawn for $3,628.80 to pay for utilities expense but was erroneously entered in the accounting records as $3826.80.
- Two debit memoranda are enclosed with the statement and are unrecorded at the time of the reconciliation. One of the debit memoranda is for $800.00 and dealt with an NSF check for $782.50 that had been received from a customer, Jackson Elite, in payment of its account. The bank assessed a $17.50 fee for processing it. The second debit memorandum is a $104.00 charge for check printing. ACME did not record this transaction before receiving the statement.
- A credit memorandum indicates that the bank collected $19,950 cash on a note receivable for the company, deducted a $20 collection fee, and credited the balance to the company’s cash account. ACME did not record this transaction before receiving the statement.
- ACME’s January 31 daily cash receipts of $10,252.39 were placed in the bank’s night depository on that date and do not appear on the January 31 bank statement.
Prepare the bank reconciliation for this company as of January 31, 2019.
Prepare the journal entries necessary to bring the company’s book balance of cash into conformity with the reconciled cash balance as of January 31, 2019.