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Complete Bank Reconciliation with Journal Entries

The following information pertains to Family Video Company.

1. Cash balance per bank, July 31, $7,742.36.
2. July bank service charge not recorded by the depositor $29.85.
3. Cash balance per books, July 31, $7,764.74.
4. Deposits in transit, July 31, $1,599.00.
5. Bank collected $959.40 note for Family in July, plus interest $38.38, less fee $21.32. The collection has not been recorded by Family, and no interest has been accrued.
6. Outstanding checks, July 31, $630.01.

Prepare a bank reconciliation at July 31. (Round answers to 2 decimal places, e.g. 10.50.)

Journalize the adjusting entries at July 31 on the books of Family Video Company. (For multiple debit/credit entries, list amounts from largest to smallest, e.g. 10,5, 3 ,2. Round answers to 2 decimal places, e.g. 10.50.)

Solution Summary

This solution illustrates how to complete a two-sided bank reconciliation (i.e., adjusted balance per bank and adjusted balance per books), and how to journalize the needed adjustments.