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Beginning balances

We need to define the current balances for the Bank's Cash Balance (Per Bank Statement) and the Company's Cash Balance (Per General Ledger).

Bank's Cash Balance

Per Bank Statement???
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??????
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Bank Balance per Reconciliation???

Company's Cash Balance

Per General Ledger???
??????
??????
??????
Company Balance per Reconciliation???

Scenario: On April 31st, 2022, Hats LLC has a Cash balance of $800. Over the course of the month, they wrote $10,000 in checks, but $200 of those checks haven’t been processed by CashForDays bank. In addition, $170 out of their $20,000 in cash receipts still needs to be deposited in CashForDays Bank.

However, on their bank statement, it shows a Cash Balance of $850 and includes the following items not yet recorded by the company: a note receivable collected by the bank for $200, interest earned on that note of $20, and a bank service fee of $50. In addition, the bank accidentally charged Hats LLC $50 for a service fee that was meant to be on another customer’s account. Lastly, one of Hats LLC customer’s checks for $100 returned back with non-sufficient funds.

Prepare the bank reconciliation to correct the ending Cash Balance on April 31st, 2022.

This is telling us that on the Bank's side, they have $850 recorded as Hats LLC's Cash balance.

Relating this to the bank reconciliation tables, this is the value for the "Per Bank Statement" in the Bank's Cash Balance!

Bank's Cash Balance

Per Bank Statement$850
??????
??????
??????
Bank Balance per Reconciliation???

Company's Cash Balance

Per General Ledger???
??????
??????
??????
Company Balance per Reconciliation???

Question: On April 31st, 2022, Hats LLC has a Cash balance of $800. Over the course of the month, they wrote $10,000 in checks, but $200 of those checks haven’t been processed by CashForDays bank. In addition, $170 out of their $20,000 in cash receipts still needs to be deposited in CashForDays Bank.

However, on their bank statement, it shows a Cash Balance of $850 and includes the following items not yet recorded by the company: a note receivable collected by the bank for $200, interest earned on that note of $20, and a bank service fee of $50. In addition, the bank accidentally charged Hats LLC $50 for a service fee that was meant to be on another customer’s account. Lastly, one of Hats LLC customer’s checks for $100 returned back with non-sufficient funds.

Prepare the bank reconciliation to correct the ending Cash Balance on April 31st, 2022.

Hats LLC is the company here, and they're saying that at the end of the month, they have a Cash balance of $800 (in their General Ledger).

Relating this to the bank reconciliation tables, this is the value for the "Per General Ledger" in the Company's Cash Balance!

Bank's Cash Balance

Per Bank Statement$850
??????
??????
??????
Bank Balance per Reconciliation???

Company's Cash Balance

Per General Ledger$800
??????
??????
??????
Company Balance per Reconciliation???

This results in the following output for current balances!

Bank's Cash Balance

Per Bank Statement$850
??????
??????
??????
Bank Balance per Reconciliation???

Company's Cash Balance

Per General Ledger$800
??????
??????
??????
Company Balance per Reconciliation???