At March 31, Cummins Co. had an unadjusted balance in its cash account of $9,700. At the end of March, the company determined that it had outstanding checks of $950, deposits in transit of $620, a bank service charge of $25, and an NSF check from a customer for $210. What is the true cash balance at March 31

$9,465

Explanation:

The computation of the true cash balance as on March 31 is shown below:

= Unadjusted cash balance as on March 31 - bank service charges - NSF check from a customer

= $9,700 - $25 - $210

= $9,465

These above two items are to be deducted

The other two items i.e outstanding checks and the deposit in transit are related to the bank balance and the same is not considered

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