Journalize the adjusting entrees to be made by baumgarder

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Reference no: EM13573547

Baumgardner Company's bank statement from Last National Bank at August 31, 2010, shows the following information.

Balance, August 1st $17,400

August Deposits 73,110

Checks cleared in August 71,500

Balance, August 31st 25,932

Bank Credit Memoranda:

Collection of Note

Recievable Plus $130

Interest $6930

Interest Earned 32

Bank Debit Memoranda:

Safety Deposit Box Rent 40

A summary of the Cash account in the ledger for August shows: Balance, August 1, $16,900; receipts $77,000; disbursements $73,570; and balance, August 31, $20,330. Analysis reveals that the only reconciling items on the July 31 bank reconciliation were a deposit in transit for $4,000 and outstanding checks of $4,500. The deposit in transit was the first deposit recorded by the bank in August. In addition, you determine that there were tow errors involving company checks drawn in August;

(1) A check for $240 to a creditor on account that cleared the bank in August was journalized and posted for $420 . (2) A salary check to an employee for $275 was recorded by the bank for $278.

Instructions

Prepare a bank reconciliation at August 31.
Journalize the adjusting entrees to be made by Baumgarder Company at August 31. Assume that interest on the note has not been accrued by the company.

Reference no: EM13573547

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