Hidetoshi Company maintains a checking account at the Imura Bank. At July 31, selected data from the ledger balance and the bank statement are shown below.
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Cash in Bank
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Per Books
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Per Bank
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Balance, July 1
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$17,600
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$16,800
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July receipts
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81,400
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July credits
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82,470
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July disbursements
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77,150
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July debits
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74,756
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Balance, July 31
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$21,850
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$24,514
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Analysis of the bank data reveals that the credits consist of $79,000 of July deposits and a credit memorandum of $3,470 for the collection of a $3,400 note plus interest revenue of $70. The July debits per bank consist of checks cleared $74,700 and a debit memorandum of $56 for printing additional company checks.
You also discover the following errors involving July checks: (1) A check for $230 to a creditor on account that cleared the bank in July was journalized and posted as $320. (2) A salary check to an employee for $255 was recorded by the bank for $155.
The June 30 bank reconciliation contained only two reconciling items: deposits in transit $7,000 and outstanding checks of $6,200.
Instructions
(a) Prepare a bank reconciliation at July 31, 2012.
(b) Journalize the adjusting entries to be made by Hidetoshi Company. Assume that interest on the note has not been accrued.