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Question
The bank statement for Gatlin Co. indicates a balance of $7,735 on June 30. The cash balance according to the company’s records is $4,098. The following additional data were gathered to use in reconciling the bank account:
(1) Cash sales of $742 had been erroneously recorded in the cash receipts journal as $724.
(2) Deposits in transit not recorded by bank, $425.
(3) Bank debit memo for service charges, $35.
(4) Bank credit memo for note collected by bank, $2,475 including $75 interest.
(5) Bank debit memo for $256 NSF (not sufficient funds) check from Janice Smith, a customer.
(6) Checks outstanding, $1,860.
Journalize any necessary entries for Gatlin Co. based on the bank reconciliation data.
Answer
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