Green valley bank sent comstock industries its end-of-month bank statement for july. the end of month balance by the bank is $11,237. the statement shows that a deposit for $4,250 is in transit at the end of the statement period. the statement also revealed that checks for $87, $105, and $95 are outstanding. green valley collected a $4,000 note receivable plus $120 of interest revenue. the bank charges $20 for the collection service. the bank charges a monthly account fee of $35. the end-of-month balance per company books is $11,135. required: (1) what is the adjusted balance on the bank reconciliation? (2) journalize any necessary entries for comstock industries based on the bank reconciliation.

(1) $11,080.00

(2) Journalized entries

Debit Bank charges account        $20

Credit Cash account                      $20

Being entries to recognize bank charges for the month.

Debit Account fee account            $35

Credit Cash account                      $35

Being entries to recognize Account fee charged for the month.

Explanation:

The bank reconciliation statement is as stated below.

                                                 Amount in $  

Balance per bank statement    11,237.00  

Deposit in transit                             4,250.00  

Outstanding check                     (287.00)

Note receivable collected             (4,000.00)

Interest revenue                                (120.00)

Bank charges                                  20.00  

Account fee                                         35.00  

Book balance                             11,135.00  

Bank charges                                (20.00)

Account fee                                        (35.00)  

Adjusted book balance              11,080.00  

The bank charge and account fee are the transactions that will be adjusted for.

To adjust these items

Debit Bank charges account        $20

Credit Cash account                      $20

Being entries to recognize bank charges for the month.

Debit Account fee account            $35

Credit Cash account                      $35

Being entries to recognize Account fee charged for the month.

due to the changes the federal reserve is making the unused reserves will impact the economy by them facing inflation. inflation is definfed as the increase in pricing of a good or service but the decline of the value of money used for purchasing those items. when the economy has a high inflation rate, they are subject to money loss and hurt on the economy.

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