Reference no: EM132251270

Question - Rudder Scudder, Inc., received a bank statement for the month ending June 30, 2015, which showed an ending balance of $3,600. The company's Cash account in the general ledger showed a balance of $1,204 as of June 30, 2015.

Other information that may be relevant in preparing a bank reconciliation as of June 30, 2015, is as follows:

1. The bank returned an NSF check from a customer of Rudder Scudder for $480. The check had been received from a customer for its payment of its outstanding account.

2. Rudder Scudder recorded cash receipts of $340 on June 30, 2015, but this amount does not yet appear on the bank statement.

3. A check written by Rudder Scudder and correctly paid by the bank for $1,740 was incorrectly recorded in the cash payments journal as $1,470. The check was a payment on an account to a vendor.

4. Checks which were written in May 2015 but still had not been presented to the bank for payment at June 30, 2015, amounted to $780.

5. The bank included a credit to the company's bank account for $1,526, which represents a collection of a customer's note receivable by the bank on behalf of Rudder Scudder. The principal amount of the note was $1,400, while the remainder was interest.

6. The bank charged the company's bank account $20 for services charges for the month of June.

7. Checks which were written in June 2015 which have not been paid by the bank as of June 30 amounted to $1,200.

QUESTIONS:

1. Prepare a properly-formatted bank reconciliation for Rudder Scudder, Inc., as of June 30, 2015. Since you are not able to present the bank reconciliation side-by-side, you may list the Bank side first, followed by the Book side.

2. What journal entries are necessary to correct the books for Rudder Scudder, Inc., as of June 30, 2015?