Question

Wright Company deposits all cash receipts on the day when they are received and it makes all cash payments by check. At the close of business on May 31, 2017, its Cash account shows a \(27,500 debit balance. The company’s May 31 bank statement shows \)25,800 on deposit in the bank. Prepare a bank reconciliation for the company using the following information.

a. The May 31 bank statement lists \(100 in bank service charges; the company has not yet recorded the cost of these services.

b. Outstanding checks as of May 31 total \)5,600.

c. May 31 cash receipts of \(6,200 were placed in the bank’s night depository after banking hours and were not recorded on the May 31 bank statement.

d. In reviewing the bank statement, a \)400 check written by Smith Company was mistakenly drawn against Wright’s account.

e. The bank statement shows a $600 NSF check from a customer; the company has not yet recorded this NSF check

Short answer

Answer

The Adjusted Bank statement balance and Adjusted Book balance are $26,800.

Step-by-step solution

Step-by-Step SolutionStep 1: Introduction to topic

Bank Statement- A bank statement or account statement is a document normally sent by the bank to the account holder consistently, summing up every one of the transactions of an account during the month.

Bank Reconciliation Statement-

Wright Company
Bank Reconciliation
Bank statement balance	$25,800	Book Balance	$27,500
Add:		Add:
Deposit of May 31	$6,200
Bank Error	$400	Deduct:
Deduct:		Bank Service charges	-$100
Outstanding Check	-$5,600	NSF check	-$600
	$26,800		$26,800