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3 October, 06:18

A company's Cash account shows an ending balance of $4,400. Reconciling items included a bookkeeper error of $100 (a $500 check recorded as $600), two outstanding checks totaling $810, a service charge of $25, a deposit in transit of $250, and interest revenue of $30. What is the adjusted book balance?

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  1. 3 October, 10:08
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    The adjusted book balance is $4,505

    Explanation:

    For computing the adjusted book balance, various adjustments are required which is shown below:

    = Cash account ending balance + bookkeeper error - service charge + interest revenue

    = $4,400 + $100 - $25 + $30

    = $4,505

    The outstanding checks and the deposit in transit are not considered in the computation part. Thus, these are ignored

    Hence, the adjusted book balance is $4,505
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