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ACC 205 Week 2 DQ Bank Reconciliation.

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ACC 205 Week 2 DQ
Bank Reconciliation
Bank Reconciliaon
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Bank Reconciliation Sumarize
Step 1. Adjusting the Balance per Bank
We will demonstrate the bank reconciliation process in several steps.
The first step is to adjust the balance on the bank statement to the true,
adjusted, or corrected balance. The items necessary for this step are
listed in the following schedule:
Step 1. | Balance per Bank Statement on Aug. 31, 2010 |
| Adjustments: |
| Add: Deposits in transit |
| Deduct: Outstanding checks |
| Add or Deduct: Bank errors |
| Adjusted/Corrected Balance per Bank |
Deposits in transit are amounts already received and recorded by the
company, but are not yet recorded by the bank. For example, a retail
store deposits its cash receipts of August 31 into the bank's night
depository at 10:00 p.m. on August 31. The bank will process this

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deposit on the morning of September 1. As of August 31 (the bank
statement date) this is a deposit in transit.
Because deposits in transit are already included in the company's Cash
account, there is no need to adjust the company's records. However,
deposits in transit are not yet on the bank statement. Therefore, they
need to be listed on the bank reconciliation as an increase to the
balance per bank in order to report the true amount of cash.
Outstanding checks are checks that have been written and recorded in
the company's Cash account, but have not yet cleared the bank account.
Checks written during the last few days of the month plus a few older
checks are likely to be among the outstanding checks.
Because all checks that have been written are immediately recorded in
the company's Cash account, there is no need to adjust the company's
records for the outstanding checks. However, the outstanding checks
have not yet reached the bank and the bank statement. Therefore,
outstanding checks are listed on the bank reconciliation as a decrease in
the balance per bank.
Bank errors are mistakes made by the bank. Bank errors could include
the bank recording an incorrect amount, entering an amount that does
not belong on a company's bank statement, or omitting an amount from
a company's bank statement. The company should notify the bank of its
errors. Depending on the error, the correction could increase or
decrease the balance shown on the bank statement. (Since the
company did not make the error, the company's records are not
changed.)
Step 2. Adjusting the Balance per Books
The second step of the bank reconciliation is to adjust the balance in the
company's Cash account so that it is the true, adjusted, or corrected
balance. Examples of the items involved are shown in the following
schedule:
Step 2. | Balance per Books on Aug. 31, 2010 |
| Adjustments: |
| Deduct: Bank service charges |

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Anonymous
Really great stuff, couldn't ask for more. The assignment was done with remarkable detail.

Anonymous
Solid work, thanks.

Anonymous
Goes above and beyond expectations !

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