Part A: Answer each of the following questions. Be sure to show all of your work and calculations.

On July 31, 2010, Fenton Company had a cash balance per books of $6,140. The
statement from Jackson State Bank on that date showed a balance of $7,695.80. A
comparison of the bank statement with the cash account revealed the following
facts.

• 1. The bank service charge for July was $25.

• 2. The bank collected a note receivable of $1,500 for Fenton Company on July
  15, plus $30 of interest. The bank made a $10 charge for the collection. Fenton
  has not accrued any interest on the note.

• 3. The July 31 receipts of $1,193.30 were not included in the bank deposits
  for July. These receipts were deposited by the company in a night deposit vault
  on July 31.

• 4. Company check No. 2480 issued to H. Coby, a creditor, for $384 that
  cleared the bank in July was incorrectly entered in the cash payments journal on
  July 10 for $348.

• 5. Checks outstanding on July 31 totaled $1,980.10.

• 6. On July 31 the bank statement showed an NSF charge of $690 for a check
  received by the company from P. Figura, a customer, on account.

Instructions

• (a) Prepare the bank reconciliation as of July 31.

• (b) Prepare the necessary adjusting entries at July 31.

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