Wilson is preparing his bank reconciliation at 31 May 2005. His bank statement shows a balance of $228 cash at the bank. The balance on the bank account in his general ledger is $113 (credit).
He has noted the following reasons for the difference:
(i) Cheque number 958602 was incorrectly recorded in Wilson’s cash book as $760. The cheque was correctly debited on the bank statement on 2 May as $670.
(ii) Bank charges of $428 were debited by the bank on 4 May.
(iii) A customer’s cheque for $320 was returned by Wilson’s bank in May as the customer had insufficient funds in his account. Wilson has not recorded the return of the cheque in his records.
(iv) The bank has incorrectly credited Wilson’s account with interest of $220. This is interest on a deposit account held by Wilson personally. The bank had not corrected the error by 31 May.
(v) A lodgement of $850 entered in Wilson’s cash book on 31 May was credited on the bank statement on 3 June.
(vi) Five cheques have not yet been presented at the bank. These are:
956784 —- $ 625
956892 —- $ 326
958452 —- $ 469
958541 —- $ 122
9586681 —- $ 87
Total– $ 1,629
(vii) Cheque number 956784 was lost in the post and was cancelled. Wilson has not recorded the cancellation of the cheque.
(a)Prepare the amended cash book.
(b) Prepare a reconciliation of the bank statement
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