The cash account of safe and secure security systems reported a balance of $2,490 at may 31, 2011. there were outstanding checks totaling $500 and a may 31 deposit in transit of $300. the bank statement, which came from tri cities bank, listed the may 31 balance of $3,360. included in the bank balance was a collection of $680 on account from ryan saar, a safe and secure customer who pays the bank directly. the bank statement also shows a $20 service charge and $10 of interest revenue that safe and secure earned on its bank balance.
prepare safe and secure’s bank reconciliation at may 31.

Book Balance :             $2,490                        Bank Balance:           $3,360
Add:                                                              Add:
Ryan Saar payment          680                         Deposits in Transit          300   
Interest Revenue                 10     
Less:                                                            Less:
Service Charge                ($20)                       Outstanding Checks       (500)
                                                                          
Cash Balance              $3,160                        Bank Balance            $3,160

*The payment made by Ryan Saar was directly deposited to the bank; therefor, it is not yet recorded in the company books. The same with the Interest Revenue Earned and Service Charge Fees.

*The Deposits in Transit and Outstanding Checks are not yet recorded in the bank because the deposits are still in transit while the outstanding checks are not yet cashed; however, these items were already recorded in the company books.