On May 31, 20×1, Jake obtains a bank statement from Ninth-Bank. According to the bank statement, the business bank account of Jake’s Computer Sale and Repair has an ending balance of $33,895 on May 31, 20×1. The cash account in the books of Jake’s Computer Sale and Repair shows an ending balance of $44,640.
Jake notes the following items:
• Jake deposited $11,600 in Ninth-Bank on May 30. The bank has not yet credited this amount to the business bank account.
• The following checks written by Jake have not yet been presented to Ninth-Bank for payment:
o Check #125: $350
o Check #131: $1,100
o Check #138: $90
• Jake’s Computer Sale and Repair presently has $800 in prepaid advertising on its books. The advertising agency had overcharged Jake’s Computer Sale and Repair by $150. The advertising agency corrects the error and deposits the amount directly into the business bank account.
• Bank service charges per the bank statement are $35.
• Interest earned on the bank balance is $10.
• A check for $250, previously recorded as a payment by a customer on an account receivable, was returned marked “nonsufficient funds” (NSF).
• The bank incorrectly debited the bank account of Jake’s Computer Sale and Repair for $560. This amount in fact relates to a check drawn on the account of a different business, Jack’s Car Sales and Repairs.
Prepare the bank reconciliation of Jake’s Computer Sale and Repair as of May 31, 20×1.