Fraud, Internal Control, and Cash

1. Balance September 1-$17,150; Cash deposited-$64,000.
2. Balance September 30-$17,404; Cash written-$63,746.

The September bank statement shows a balance of $16,422 on September 30 and the following memoranda.

At September 30, deposits in transit were $5,450, and outstanding checks totaled $2,383.

Instructions

1. Prepare the bank reconciliation at September 30.
2. Prepare the adjusting entries at September 30, assuming (1) the NSF check was from a customer on account, ad (2) no interest had been accrued on the note.

Solution