2. In preparing its May 31, 2004 bank reconciliation, Dogg Co. has the
following information available:
Balance per bank statement, 5/31/04 $27,000
Deposit in transit, 5/31/04 5,400
Outstanding checks, 5/31/04 4,900
Note collected by bank in May 1,250
The correct balance of cash at May 31, 2004 is
Balance per bank $27,000
Add: deposit in transit 5,400
Less: outstanding check ...
The solution presents the bank reconcilation for Dogg Co. plus information to explain the treatment of the note collected by the bank in May.