Prepare a bank reconciliation for blockwood checking account

Reference no: EM131520174

Question: On October 31, 2012, the bank statement for the checking account of Blockwood Video shows a balance of $12,630, while the company's records show a balance of $12,331. Information that might be useful in preparing a bank reconciliation is as follows:

a. Outstanding checks are $1,230.

b. The October 31 cash receipts of $785 are not deposited in the bank until November 2.

c. One check written in payment of utilities for $137 is correctly recorded by the bank but is recorded by Blockwood as a disbursement of $173.

d. In accordance with prior authorization, the bank withdraws $650 directly from the checking account as payment on a note payable. The interest portion of that payment is $50 and the principal portion is $600. Blockwood has not recorded the direct withdrawal.

e. Bank service fees of $24 are listed on the bank statement.

f. A deposit of $567 is recorded by the bank on October 13, but it did not belong to Blockwood. The deposit should have been made to the checking account of Hollybuster Video, a separate company.

g. The bank statement includes a charge of $75 for an NSF check. The check is returned with the bank statement, and the company will seek payment from the customer.

Required: 1. Prepare a bank reconciliation for the Blockwood checking account on October 31, 2012.

2. Record the necessary cash adjustments.

Reference no: EM131520174

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