In the Process of Reconciling Its Bank Statement for April,Donahue

question 206

Multiple Choice

In the process of reconciling its bank statement for April,Donahue Enterprises' accountant compiles the following information:
$$\begin{array} { | l | r | } \hline \text { Cash balance per company books on April 30 } & \$ 6,275 \\\hline \text { Deposits in transit at month-end } & \$ 1,300 \\\hline \text { Outstanding checks at month-end } & \$ 620 \\\hline \text { Bank charge for printing new checks } & \$ 45 \\\hline \text { Note receivable and interest collected by bank on Donahue's behalf } & \$ 770 \\\hline \begin{array} { l } \text { A check paid to Donahue during the month by a customer is returned by } \\\text { the bank as NSF }\end{array} & \$ 480 \\\hline\end{array}$$
The adjusted cash balance per the books on April 30 is:

• A) $6,900
• B) $8,160
• C) $4,600
• D) $6,520
• E) $5,840

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Definitions:

Supplies

Items that are used in the day-to-day operation of a business but do not directly become part of the finished product.

Fees Earned

Income received by a company or professional for services rendered.

Credit

A bookkeeping entry that increases liabilities or equity on the balance sheet or decreases an asset or expense account on the income statement.

Understated

Describes a situation where the amount, value, or importance of something is reported lower than it actually is, potentially affecting financial statements and analysis.