Problem:
Kipling Company deposits all receipts and makes all payments by check. The following information is available from the cash records.
June 30 Bank Reconciliation
Balance per bank $7,000
Add: Deposits in transit 1,540
Deduct: Outstanding checks (2,000)
Balance per books $6540
Month of July Results
Balance July 31 Per Bank - $8650 Per Books - 9250
July Deposits Per Bank - 4500 Per Books - 5810
July checks Per Bank - 4000 Per Books - 3100
July note collected (not included in July deposits) Per Bank - 1500 Per Books - (--)
July Bank service charge Per Bank - 15 Per Books - (--)
July NSF check from a customer, return by the bank Per Bank - 335 Per Books - (--)
(recorded by bank as a charge)
Instructions:
Q1. Prepare a bank reconciliation going from balance per bank and balance per book to correct cash balance.
Q2. Prepare the general journal entry or entries to correct the Cash account