KrenzKarKare, Owned and Operated by Karl Krenz, Began Business in September

question 64

Essay

KrenzKarKare, owned and operated by Karl Krenz, began business in September of the current year. Karl, a master mechanic, had no experience with keeping a set of books. As a result, Karl entered all of September's transactions directly to the General Ledger accounts. When he tried to locate a particular entry originally made on September 8, he found it confusing and time-consuming. He has hired you to improve his bookkeeping procedures. The accounts in his General Ledger follow:
Prepare the general journal entries, in chronological order, from the general ledger entries shown. Include a brief description of the probable nature of each transaction.

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Definitions:

Electronic Funds Transfer

A system that allows the transfer of money between bank accounts without the physical exchange of cash, checks, or other negotiable instruments.

Outstanding Checks

Checks that have been issued and recorded in the payer's financial statements but have not yet been cashed or cleared by the bank.

Bank Reconciliation

The method of aligning the figures in a company's financial records for a cash account with the relevant data on a bank statement.

Bank Service Charge

Fees charged by banks for various services provided to customers, such as account maintenance or transaction processing.