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Posted by: Christian
Price Quoted by Student: $9
Posted On: 2011-09-17 07:07:27
 
Question
El Gato Painting Company maintains a checking account at American Bank. Bank statements are prepared at the end of each month. The November 30, 2011, reconciliation of the bank balance is as follows:

Balance per bank, November 30                                                         $3,231

Add: Deposits outstanding                                                                   1,200

less: Checks outstanding

#363                                                                            $123

#365                                                                            201

#380                                                                            56

#381                                                                            86

#382                                                                            340      (806)

Adjusted balance per bank, November 30                                           $3,625

The company's general ledger checking account showed the following for December:

Balance December 1                $3,625

Receipts                                   42,650

Disbursements                                     (41,853)

Balance, December                  $4,422

The December bank statement contained the following information:

Balance, December 1               $3,231

Deposits                                   43,000

Checks processed                    (41,918)

Service charges                        (22)

NSF checks                              (440)

Balance, December 31                         $3,851)

The checks that were processed by the bank in December include all of the outstanding checks at the end of November except for check #365. In addition, there are some December checks that had not been processed by the bank by the end of the month. Also, you discover that check #411 for $320 was correctly recorded by the bank but was incorrectly recorded on the books as a $230 disbursement for advertising expense. Included in the bank's deposits is a $1,300 deposit incorrectly credited to the company's account. The deposit should have been posted to the credit of the Los Gatos Company. The NSF checks have not been redeposited and the company will seek payment from the customers involved.

Required:

1. Prepare a bank reconciliation for the El Gato checking account at December 31, 2011

2. Prepare any necessary adjusting journal entries indicated.

P 7-14 Bank reconciliation and adjusting entries. El Gato Painting Company maintains a checking account at American Bank. Bank statements are


Solutions
Problem 7-14 Requirement 1
Price $9
Attachment 1: P 7-14 El Gato Painting Company.doc
Solution Posted By: Christian    Posted on: 17-09-2011