Reference no: EM132495382

On June 30, 2021, EZ Fertilizer's cash account per its general ledger showed the following balance:

CASH No. 101

Date Explanation Ref Debit Credit Balance

June 30 Balance 6,925

The bank statement from Canada Bank on that date showed the following balance:

CANADA BANK

Cheques and Debits Deposits and Credits Daily Balance

XXX XXX 6/30 6,776

1. A comparison of the details on the bank statement with the details in the Cash account revealed the following facts.
2. The bank statement included a debit memo of $40 for printing of additional company cheques.
3. Cash sales of $624 on June 21 were deposited in the bank. The bookkeeper recorded the deposit in the cash journal as $642.
4. Outstanding cheques on June 30 totalled $946 and deposits in transit were $1,587.
5. On June 18, the company issued cheque #1924 for $356 to D. Katz on account. The cheque, which cleared the bank in June, was incorrectly journalized and posted by EZ Fertilizer for $536.
6. A $1,550 note receivable was wired to the bank account of EZ Fertilizer on June 30 plus $45 interest. The bank charged a $25 collection fee. No interest has been accrued on the note.
7. Included with the cancelled cheques was a cheque issued by EZ Company for $234 that was incorrectly charged to EZ Fertilizer by the bank.
8. On June 30, the bank statement showed an NSF charge of $966 for a cheque issued by Amanda Vallee, a customer, to EZ Fertilizer on account.

Instructions

Question a. Prepare the bank reconciliation at June 30.

Question b. Prepare the necessary adjusting entries at June 30.