Flounder Corporation is preparing a bank reconciliation and has identified the following potential reconciling items. (a) Deposit in transit $6,150.

(b) Bank service charges $38. (Use Office Expense account.)

(c) Interest credited to Flounder's account $32.

(d) Outstanding checks $7,670. (e) NSF check returned $570.

Prepare entries necessary to make Flounder's accounting records correct and complete.

Question

Business

Anika Leach

22 May, 18:49

Flounder Corporation is preparing a bank reconciliation and has identified the following potential reconciling items. (a) Deposit in transit $6,150.

(b) Bank service charges $38. (Use Office Expense account.)

(c) Interest credited to Flounder's account $32.

(d) Outstanding checks $7,670. (e) NSF check returned $570.

Prepare entries necessary to make Flounder's accounting records correct and complete.

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Answers (1)

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Van Schultz · Answer 1

The journal entries are shown below:

a. No entry passed

b. Office expense A/c Dr $38

To Cash $38

(Being bank service charges paid)

c. Cash A/c Dr $32

To Interest revenue $32

(Being interest received)

d. No entry passed

e. Accounts receivable A/c Dr $570

To Cash A/c $570

(Being check returned)

The deposit in transit and outstanding checks should not be recorded. So, no entry is passed.