Answer
The answer and procedures of the exercise are attached in the following archives.
Step-by-step explanation:
You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.
Answer:
a) Amount in $
Balance per bank statement 3,560.20
Deposit in transit 530.00
Outstanding check (730.00)
Bank charges 25.00
NSF Check 490.00
Book balance 3,875.20
b)
Debit Bank charge $25
Credit Cash account $25
Being entries to recognize bank charges for the period.
Explanation:
Considering the transaction, Deposit in transit has been recognized in the books and will thus be added to the balance per bank. The bank charge was deducted from the bank balance but is yet to be deducted from the book balance hence it is added back to the bank balance. The outstanding check has been deducted from the books hence the deduction from the bank. See the reconciliation below.
Amount in $
Balance per bank statement 3,560.20
Deposit in transit 530.00
Outstanding check (730.00)
Bank charges 25.00
NSF Check 490.00
Book balance 3,875.20
b) The entries required is the recognition of the bank charge in the books
Debit Bank charge $25
Credit Cash account $25
Being entries to recognize bank charges for the period.
