The cash account for Norwegian Medical Co. at April 30 indicated a balance of $403,784. The bank statement indicated a balance of $468,460 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items: A. Checks outstanding totaled $73,870.
B. A deposit of $51,230, representing receipts of April 30, had been made too late to appear on the bank statement.
C. The bank collected $50,630 on a $48,220 note, including interest of $2,410.
D. A check for $9,160 returned with the statement had been incorrectly recorded by Norwegian Medical Co. as $916. The check was for the payment of an obligation to Universal Supply Co. for a purchase on account.
E. A check drawn for $680 had been erroneously charged by the bank as $860.
F. Bank service charges for April amounted to $170.
Required:
1. Prepare a bank reconciliation. Be sure to complete the statement heading.
2. Journalize the necessary entries. The accounts have not been closed.
DATE DESCRIPTION POST. DEBIT CREDIT ASSETS LIABILITIES EQUITY
1 Apr. 30 Cash 0,630.00
2 Interest Revenue 2,410.00
3 Apr. 30 Accounts Payable-
Universal Supply Co.8,244.00
4 Cash 8,244.00
5 Apr. 30 Miscellaneous
Expense 170.00
6 Cash 170.00 1
3. If a balance sheet is prepared for Norwegian Medical Co. on April 30, what amount should be reported as cash?