Flounder corporation is preparing a bank reconciliation and has identified the following potential reconciling items.
(a) deposit in transit $6,150.
(b) bank service charges $38. (use office expense account.)
(c) interest credited to flounder’s account $32.
(d) outstanding checks $7,670.(e)nsf check returned $570.

prepare entries necessary to make flounder’s accounting records correct and complete.

Explanation:

The journal entries are shown below:

a. No entry passed

b. Office expense A/c Dr $38

          To Cash                             $38

(Being bank service charges paid)

c. Cash A/c Dr $32

           To Interest revenue  $32

(Being interest received)

d. No entry passed

e. Accounts receivable A/c Dr $570

         To Cash A/c                                   $570    

(Being check returned)

The deposit in transit and outstanding checks should not be recorded. So, no entry is passed.

answer; (inseparability);

answer; institution based;