The following is information for the Bittman Company Ltd.:
a. Balance per the bank statement for December 31, 2019 is $25,430.
b. Balance of the Cash account in the general ledger at December 31 is $11,040.
c. A cheque for $840 that had been deposited in the bank was incorrectly
recorded in the general ledger as $930.
d. A cheque for $2,100 deposited on December 21 was returned by the bank
marked NSF; no entry has been made on the company records to reflect the
returned cheque.
e. Among the cancelled cheques is one for $345 given in payment of an account
payable; the cheque has been recorded as $480 in the company records.
f. Bank service charges for December amount to $50. These were not yet
recorded in the company records.
g. The bank erroneously charged the Bittman Company account for a $10,000
cheque of the Pittman Company.
h. The bank had collected a $15,000 note plus accrued interest amounting to $75;
$15,075 was credited to Bittman’s account; a collection fee of $10 was debited
to Bittman Company’s account. None of these transactions were recorded in
the company records.
i. The bank deposit made December 3 for $1,570 does not appear on the bank
statement
j. Outstanding cheques at December 31 were no. 197, $4,000, and no. 199,
$9,000.
Required:
1. Prepare a bank reconciliation statement at December 31, 2019.
2. Prepare the necessary adjusting journal entries to make the Cash account in
the general ledger agree with the bank reconciliation adjusted cash balance at
December 31.