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Accounting problem: Bank reconciliation.

Tom Landry owns a construction business, Landry Supply Co. The following cash information is available for the month of October 2008. As of October 31, the bank statement shows a balance of $13,800. The October 31 unadjusted balance in the Cash account of Landry Supply Co. is $12,700. A review of the bank statement revealed the following information:

1. A deposit of $1,600 on October 31, 2008, does not appear on the October 31 bank statement.

2. A debit memo for $250 was included in the bank statement for the purchase of a new supply of checks.

3. When checks written during the month were compared with those paid by the bank, three checks amounting to $4,450 were found outstanding.

4. It was discovered that a check to pay for repairs was correctly written and paid by the bank for $3,100 but was recorded on the books as $1,600.

Please help with:

Preparing a bank reconciliation at the end of October showing the true cash balance.

Preparing any necessary journal entries to adjust the books to the true cash balance.

Thank you.

Solution Summary

The problem deals with bank reconciliation in accounting.