Question :

Kat Bardash, a student at a small state college, has just get her first checking account statement for the month ended September 30. This is her first option to attempt bank reconciliation. The bank's statement of account shows the subsequent information:

Bank balance, September 1 $1,150

Deposits during September 650

Checks cleared during September 900

Bank service charge 25

Interest earned 5

Bank balance, September 30 880

Kat is surprised that her bank has not yet reported the $50 deposit that she made on September 29 and pleased that her $200 rent check has not yet cleared her account. Her September 30 checkbook balance is $750.

Required:

1. Evaluate Kat's bank reconciliation. What adjustments, if any, does she require to make in her checkbook?

2. Why is it important for individuals and businesses to organize bank reconciliation each month?