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Trex Co.

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Please find attached the XCEL file containing the questions.

The following information is available for Trex Co.:

a) Balance per the bank staement dated March 31, 2007, is $32,950.
b) Balance of the Cash account on the company books as of March 31, 2007 is $31,396
c) Included with the bank statement was a $35 credit memorandum for the interest earned
on the bank account during the month.
d) Bank deposit of March 31, 2007, for $1,300 does not appear on the bank statement.
e) Bank service charges for the month amount to $30.
f) Cheque#824, for office supplies in the amount of $697, was recorded incorrectly in
the Cash Disbursements Journal as $796.
g) Cheques written that had not cleared the bank by March 31, 2007, were the following:
1. #835: $1,200
2. #848: $950
3. #836: $950
h) Included with the bank statement was an NSF cheque for $650 that had been received
from a customer in payment of his account.
i) The bank had collected a $300 note on behalf of Trex Co.

Required:

a. Prepare the bank reconciliation at March 31,2007.

b. Prepare any adjusting journal entries relating to this bank reconciliation.

Date Account Titles and Explanation Debit Credit

c. Identify 2 reasons why bank reconciliations must be prepared regularly?

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This solution is comprised of a detailed explanation to prepare the bank reconciliation at March 31,2007.

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The following information is available for Trex Co.:

a) Balance per the bank statement dated March 31, 2007, is $32,950.
b) Balance of the Cash account on the company books as of March 31, 2007 is $31,396
c) Included with the bank statement was a $35 credit memorandum for the interest earned ...

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