The November 30 bank statement of Donald Engineering Associates has just arrived from Kansas First Bank. To prepare the Donald bank reconciliation, you gather the following data:
a. Donald's Cash account shows a balance of $7,684.83 on November 30.
b. The November 30 bank balance is $8,457.95.
c. The bank statement shows that Donald earned $16.38 of interest on its bank balance during November. This amount was added to Donald's bank balance.
d. Donald pays utilities ($750) and insurance ($240) by EFT.
e. The following Donald checks did not clear the bank by November 30:
|
Check No.
|
Amount
|
|
237
|
$404.80
|
|
288
|
74.82
|
|
291
|
34.89
|
|
293
|
173.25
|
|
294
|
238.00
|
|
295
|
47.75
|
|
296
|
105.78
|
f. The bank statement includes a deposit of $903.10, collected on account by the bank on behalf of Donald.
g. The bank statement lists a $7.50 bank service charge.
h. On November 30, the Donald treasurer deposited $381.75, which will appear on the December bank statement.
i. The bank statement includes a $415.00 deposit that Donald did not make. The bank added $415.00 to Donald's account for another company's deposit.
j. The bank statement includes two charges for returned checks from customers. One is a $193.75 check received from a customer with the imprint "Unauthorized Signature." The other is a nonsufficient funds check in the amount of $67.65 received from another customer.
Requirements
1. Prepare the bank reconciliation for Donald Engineering Associates.
2. Journalize the November 30 transactions needed to update Donald's Cash account. Include an explanation for each entry.