The cash account for Online Medical Co. at June 30, 2014, indicated a balance of $9,925. The bank statement indicated a balance of $11,540 on June 30, 2014. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:
Checks outstanding totaled $4,150.
A deposit of $4,330, representing receipts of June 30, had been made too late to appear on the bank statement.
The bank had collected $2,250 on a note left for collection. The face of the note was $2,130.
A check for $440 returned with the statement had been incorrectly recorded by Online Medical Co. as $400. The check was for the payment of an obligation to Hirsch Co. for the purchase on account.
A check drawn for $40 had been erroneously charged by the bank as $400.
Bank service charges for June amounted to $55.
Cash balance according to bank statement
add deposit of June 30, not recorded by bank
add bank error in charging check at 400 and no 40
deduct outstanding checks
adjusted balance
case balance according to company records
add proceeds of note collected by bank, including 120 interest
deduct error in recording check
deduct bank service charges
adjusted balance