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Bourne Incorporated reports a cash balance at the end of the month of $2,445. A comparison of the company's cash records with the monthly bank statement reveals several additional cash transactions: bank service fees ($78), an NSF check from a customer ($280), a customer’s note receivable collected by the bank ($1,100), and interest earned ($28).


Required:

Record the necessary entries to adjust the balance of cash.

Sagot :

Answer and Explanation:

The journal entries required to adjust the balance of cash as follows:

1. Cash Dr $1,128

       To Notes receivable  $1,100

       To Interest revenue $28

(Being the cash is recorded)

Here cash is debited as it increased the assets and credited the notes receivable and interest revenue as it decreased the assets and revenue

2. Service expense Dr $78

Account receivable Dr $280

      To cash $358

(being the cash paid is recorded)

here service expense and account receivable is debited as it increased the expenses and assets and credited the cash as it decreased the assets

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