Reference no: EM132601033

The cash account of Sheffield Co. showed a ledger balance of $11,765.55 on June 30, 2020. The bank statement as of that date showed a balance of $12,450. Upon comparing the statement with the cash records, the following facts were determined.

1. There were bank service charges for June of $75.

2. A bank memo stated that Bao Dai's note for $3,600 and interest of $108.00 had been collected on June 29, and the bank had made a charge of $16.50 on the collection. (No entry had been made on Sheffield's books when Bao Dai's note was sent to the bank for collection.)

3. Receipts for June 30 for $10,170 were not deposited until July 2.

4. Checks outstanding on June 30 totaled $6,408.15.

5. The bank had charged the Sheffield Co.'s account for a customer's uncollectible check amounting to $759.60 on June 29.

6. A customer's check for $270 (as payment on the customer's Accounts Receivable) had been entered as $180 in the cash receipts journal by Sheffield on June 15.

7. Check no. 742 in the amount of $491 had been entered in the cash journal as $419, and check no. 747 in the amount of $174.60 had been entered as $1,746.00. Both checks had been issued to pay for purchases and were payments on Sheffield's Accounts Payable.

Question 1: Prepare bank reconciliation dated June 30, 2020, proceeding to a correct cash balance.

Question 2: Prepare entries necessary to make the books correct and complete. Use Office Expense account for bank service charges.