Beeler Furniture Company deposits all cash receipts each Wednesday and Friday in a night depository after banking hours

Beeler Furniture Company deposits all cash receipts each Wednesday and Friday in a night depository after banking hours. The data required to reconcile the bank statement as of June 30 have been taken from various documents and records and are reproduced as follows. The sources of the data are printed in capital letters. All checks were written for payments on account.

CASH ACCOUNT: Balance as of June 1$9,317.40 CASH RECEIPTS FOR MONTH OF JUNE$9,223.76 DUPLICATE DEPOSIT TICKETS: Date and amount of each deposit in June: Date Amount Date Amount Date Amount June 1 $1,080.50 June 10 $ 996.61 June 22 $ 897.34 3 854.17 15 882.95 24 947.21 8 840.50 17 1,606.74 30 1,117.74 CHECKS WRITTEN: Number and amount of each check issued in June: Check No. Amount Check No. Amount Check No. Amount 740 $237.50 747 Void 754 $   449.75 741 495.15 748 $450.90 755 272.75 742 501.90 749 640.13 756 113.95 743 761.30 750 276.77 757 407.95 744 506.88 751 299.37 758 259.60 745 117.25 752 537.01 759 901.50 746 298.66 753 380.95 760 486.39 Total amount of checks issued in June$8,395.66 BANK RECONCILIATION FOR PRECEDING MONTH:  Beeler Furniture Company Bank Reconciliation May 31 20Y2 Cash balance according to bank statement . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,447.20 Add deposit for May 31, not recorded by bank. . . . . . . . . . . . . . . . . . . . . . .        690.25 Deduct outstanding checks: No. 731 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $162.15 736 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 345.95 738 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251.40 739 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      60.55 820.05 Adjusted balance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,317.40 Cash balance according to company’s records . . . . . . . . . . . . . . . . . . . . . . . $ 9,352.50 Deduct bank service charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.10 Adjusted balance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,317.40

Instructions

1. Prepare a bank reconciliation as of June 30, 20Y2. If errors in recording deposits or checks are discovered, assume that the errors were made by the company. Assume that all deposits are from cash sales. All checks are written to satisfy accounts payable.

2. Journalize the necessary entries. The accounts have not been closed.

3. What is the amount of Cash that should appear on the balance sheet as of June 30?

4. Assume that a canceled check for $390 has been incorrectly recorded by the bank as $930. Briefly explain how the error would be included in a bank reconciliation and how it should be corrected.

AMERICAN NATIONAL BANK OF CHICAGO CHICAGO, IL 60603      (312) 441-1239 MEMBER FDIC ACCOUNT NUMBER FROM  6/01/20Y2 TO  6/30/20Y2 BALANCE 9,447.20 DEPOSITS 8,691.77 WITHDRAWALS 7,599.26 OTHER DEBITS AND CREDITS 3,085.00CR NEW BALANCE                13,624.71 9 20 4 BEELER FURNITURE COMPANY * – – – CHECKS AND OTHER DEBITS – – – * – – DEPOSITS – – * – DATE – * – – BALANCE– – * No.731 162.15 No.736 345.95 690.25 6/01 9,629.35 No.739 60.55 No.740 237.50 1,080.50 6/02 10,411.80 No.741 495.15 No.742 501.90 854.17 6/04 10,268.92 No.743 671.30 No.744 506.88 840.50 6/09 9,931.24 No.745 117.25 No.746 298.66 MS 3,500.00 6/09 13,015.33 No.748 450.90 No.749 640.13 MS    210.00 6/09 12,134.30 No.750 276.77 No.751 299.37 896.61 6/11 12,454.77 No.752 537.01 No.753 380.95 882.95 6/16 12,419.76 No.754 449.75 No.755 272.75 1,606.74 6/18 13,304.00 No.757 407.95 No.760 486.39 897.34 6/23 13,307.00    942.71 6/25 14,249.71 NSF  550.00  6/28 13,699.71 SC 75.00  6/30 13,624.71 EC –– ERROR CORRECTION OD –– OVERDRAFT MS –– MISCELLANEOUS PS –– PAYMENT STOPPED NSF –– NOT SUFFICIENT FUNDS SC –– SERVICE CHARGE * * *                                                   * * *                                                * * * THE RECONCILEMENT OF THIS STATEMENT WITH YOUR RECORDS IS ESSENTIAL. ANY ERROR OR EXCEPTION SHOULD BE REPORTED IMMEDIATELY.

Answer:

1.

Cash balance according to bank statement$13,624.71

Add deposit of June 30, not recorded by bank1,117.74

Deduct outstanding checks:

No. 738$ 251.40

756113.95

758259.60

759901.50 1,526.45

Adjusted balance$13,216.00

Cash balance according to company’s records* $10,145.50

Add: Note and interest collected by bank $3,710.00

Error in recording Check No. 743 90.00 3,800.00

Check returned because of insufficeint funds $ 550.00

Error in recording June 10 deposit 100.00

Error in recording June 24 deposit 4.50

Bank service charges75.00 729.50

Adjusted balance$13,216.00

* Balance per cash in bank account, June 1..................... $ 9,317.40

Add June receipts...................................................... 9,223.76

Deduct June disbursements....................................... (8,395.66)

Balance per cash in bank account, June 30.................. $10,145.50

2.

 20Y2

 June 30 Cash3,800.00

30 Sales ($100.00 + $4.50)104.50

Accounts Receivable550.00

Miscellaneous Expense75.00

3.

4. The error of $540 ($930 – $390) in the canceled check should be added to the

“balance according to bank statement” on the bank reconciliation. The canceled 

check should be presented to the bank with a request that the bank balance be 

corrected.