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  • Bank Reconciliation Problem 1

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    Ralph Ernest Hulguin
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    Chivalry Company prepared a bank reconciliation on March 31 showing a book balance of $3.7 million and a bank balance of $3.56 million after adjustments. The reconciliation had a $45,000 error where a $249,000 check was recorded as $294,000. Correcting this error results in a $140,000 difference between the adjusted book and bank balances.

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    Bank Reconciliation Problem 1 (1) (1)

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    Chivalry Company prepared a bank reconciliation on March 31 showing a book balance of $3.7 million and a bank balance of $3.56 million after adjustments. The reconciliation had a $45,000 error where a $249,000 check was recorded as $294,000. Correcting this error results in a $140,000 difference between the adjusted book and bank balances.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    20 views1 page

    Bank Reconciliation Problem 1

    Uploaded by

    Ralph Ernest Hulguin
    Chivalry Company prepared a bank reconciliation on March 31 showing a book balance of $3.7 million and a bank balance of $3.56 million after adjustments. The reconciliation had a $45,000 error where a $249,000 check was recorded as $294,000. Correcting this error results in a $140,000 difference between the adjusted book and bank balances.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 1

    Illustrative Problem 1

    Chivalry Company prepared the following bank reconciliation on March 31

    Book Balance 1,405,000

    Add: March 31 deposit 750,000

    Collection of note 2,500,000

    Interest on note 150,000 3,400,000

    Total 4,805,000

    Less: Cavalry Company’s deposit to our account 1,100,000

    Bank service charge 5,000 1,105,000

    Adjusted book balance 3,700,000

    Bank Balance 5,630,000

    Add: Error on check No. 175 45,000

    Total

    Less: Pre authorized payment for light and water 245,000

    NSF Check 220,000

    Outstanding checks 1,650,000 2,115,000

    Adjusted bank balance 3,560,000

    Check No. 175 was made for the proper amount of P249,000 in payment of account

    However the check was entered in the cash disbursements journal as P294,000

    Chivalry Company authorized the bank to automatically pay its light and water bills as submitted
    directly to the bank.

    Required:
    a. Prepare a corrected bank reconciliation
    b. Prepare adjusting entries on March 31

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