Question

In the process of reconciling its bank statement for January, Maxi's Clothing's accountant compiles the following information:
Cash balance per company books on January 30 $ 6,125
Deposits in transit at month-end $ 2,080
Outstanding checks at month-end $ 660
Bank service charges $ 39
EFT automatically deducted monthly, not yet recorded by Maxi $ 660
An NSF check returned on a customer account $ 405
Required:
1. The adjusted cash balance per the books on January 31 is _______________.

Answer 1

Answer:

$5,021

Explanation:

The computation of the adjusted cash balance is shown below:

= Cash balance as per company books - bank service charges - EFT automatically deducted monthly, not yet recorded - NSF check returned on a customer account

= $6,125 - $39 - $660 - $405

= $5,021

All the above items should be deducted from the company books cash balance so that the adjusted cash balance could come