Gibson Energy Ltd. controls its cash by depositing receipts on a daily basis and making all disbursements by cheque. After all the posting for the month of November 2016 was completed, the Cash balance in the general ledger account at November 30 was $4,213. The bank statement for the month ended November 30 received from the First National Bank showed the balance to be $4,440. The following data are available for the purpose of reconciling these balances:
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a. |
Cash receipts for November 30 amounting to $611 have been placed in the night depository and do not appear on the bank statement. |
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b. |
Bank memos previously not available to Gibson Energy are included with the bank statement. A memo for an NSF cheque, originally received as payment for an account receivable of $130, is included. A memo for bank charges of $10 is also included. Another memo advizes Gibson Energy Ltd. that $494 has been deposited to the account, ($500 less a bank charge of $6). This represents the net proceeds of a collection the bank had made on behalf of Gibson Energy Ltd. on a $500 note receivable. |
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c. |
Cheques written during November but not included with the bank statement are no. 1154, $32; no. 1192, $54; no. 1193, $83; no. 1194, $109. |
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d. |
Cheque no. 1042 is returned with the bank statement. The cheque was made for $494, the correct amount owing for office expense. The cheque was recorded in the company records as $548. |
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e. |
Cheques outstanding at the end of October included cheques no. 1014 for $152 and no. 1016 for $179. Cheque no. 1016 was paid in the bank statement; cheque no. 1014 was not. |
Required:
- Prepare a bank reconciliation at November 30.
- Prepare the necessary adjusting journal entries required to make the Cash account in the general ledger agree with the adjusted cash balance on the November 30 bank reconciliation.
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