(a) 1. A
TIP: Items 9 and 10 would have been reconciling items of cash balances on the June 30 bank reconciliation (the prior month).
(b) 1. $3,912* ($4,232 + $1,582 + $25 - $1,927 = $3,912)
Approach to part (b) 2: You can compute the correct cash balance by completing the top half of the bank reconciliation (balance per bank to correct cash balance). The correct cash balance can then be entered on the last line of the bottom half of the reconciliation and used along with certain reconciling items to “work backwards” to compute the $3,027 cash balance per books before adjustment.
Ace Electric Co.
July 31, 20XX
TIP: The required adjusting entries on the depositor's books would be: