(solution) Madison Company's cash ledger reports the following for the month

(solution) Madison Company's cash ledger reports the following for the month

Madison Company’s cash ledger reports the following for the month ending March 31.  

 

      Date Amount   No. Date Amount
  Deposits:      3/4 $  1,200      Checks:   541      3/2 $ 5,600    
       3/11 1,600       542      3/8 800    
       3/18 4,300       543      3/12 2,900    
       3/25 3,100       544      3/19 1,800    
  Cash receipts:   3/26-3/31 2,300       545      3/27 500    
    

 

  546      3/28 800    
    $ 12,500       547      3/30 1,400    
    

 

     

 

  Balance on March 1 $   5,800           $13,800    
  Receipts 12,500          

 

  Disbursements (13,800)           
  

 

       
  Balance on March 31 $   4,500            
  

 

       

 

Information from March’s bank statement and company records reveals the following additional information:

a. The ending cash balance recorded in the bank statement is $6,462.
b. Cash receipts of $2,300 from 3/26-3/31 are outstanding.
c. Checks 545 and 547 are outstanding.
d. The deposit on 3/11 included a customer’s check for $430 that did not clear the bank (NSF check).
e. Check 543 was written for $3,500 for office supplies in March. The bank properly recorded the check for this amount.
f. An automatic withdrawal for March rent was made on March 4 for $1,250.
g. Madison’s checking account earns interest based on the average daily balance. The amount of interest earned for March is $53.
h. Last year, one of Madison’s top executives borrowed $4,400 from Madison. On March 24, the executive paid $4,660 ($4,400 borrowed amount plus $260 interest) directly to the bank in payment for the borrowing.
i. The bank charged the following service fees: $37 for NSF check, $10 for automatic withdrawal for rent payment, and $24 for collection of the loan amount from the executive.

  
1. Prepare a bank reconciliation for March 31. (Amounts to be deducted should be indicated with a minus sign.)

2..  Record the necessary cash adjustments.