Creating the bank reconciliation


Response to the following problem:

According to its books, Peerless Hospital has a cash balance of $438,104 at June 30. The June bank statement, however, reports a June 30 balance of $486,681. An investigation produces the following information:

1. The bank credited, in error, Peerless Hospital for a deposit of $28,417 made by Peerless Hospital on June 22.

2. Bank service charges for June amounted to $27.

3. Outstanding checks at June 30 were $107,092.

4. A deposit of $39,865 was in transit at June 30.

5. The June bank statement shows a credit of $10,600 (including $600 interest) representing the proceeds of a patient's note collected for the hospital by the bank.

6. The bank returned patients' checks marked "not sufficient funds" in the amount of $2,606.

7. Check number 1791 issued in payment of an account payable of $200 was recorded in error by a hospital bookkeeper as $2,000 even though the check was drawn in the correct $200 amount.

Required:

(1) Prepare a bank reconciliation at June 30.

(2) Prepare the necessary adjusting journal entry at June 30.

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Financial Accounting: Creating the bank reconciliation
Reference No:- TGS02088885

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