1. On may 31, 2021, James Logan Company had a cash balance per books of $6,781.50. The Bankstatement from Farmers Community Bank on that date showed a balance of $6,404.60. A
comparison of the statement with the cash account revealed the following facts.
1) The statement included a debit memo of $40 for the printing of additional company checks.
2) Cash sales of $836.15 on May 12 were deposited in the bank. The cash receipts journal entry
and the deposit slip were incorrectly made for $886.15. The bank credited Logan Company
for the correct amount.
3) Outstanding checks at May 31 totaled $576.25. Deposits in transit were $1,916.15.
4) On May 18, the company issued check No. 1811 for $685 to Barry Trest, on account. The
check, which cleared the bank in May, was inccorectly journalized and posted by Logan
Company for $658.
5) A $2,500 note receivable was collected by the bank for Logan Company on May 31 plus $80
interest. The bank charged a collection fee of $20. No interest has been accrued on the
note.
6) Included with the canceled checks was a check issued by Bridgetown Company to Tom Lujak
for $800 that was incorrectly charged to Logan Company by the bank.
7) On May 31, the bank statement showed an NSF charge of $680 for check issued by Sandy
Grifton, a customer, to Logan Company on account.
Instructions
a) Prepare the bank reconciliation at May 31, 2021.
b) Prepare the necessary adjusting entries for Logan Company at May 31, 2021.​