Franklin Company deposits all cash receipts on the day they are received and makes all cash payments by check. At the close of business on August 31, its Cash account shows a debit balance of $13,162. Franklin's August bank statement shows $14,237 on deposit in the bank. Determine the adjusted cash balance using the following information:
Deposit in transit $4,800
Outstanding checks $4,100
Bank service fees, not yet recorded by company $60
The bank collected on a note receivable, not yet recorded by the company $1,635
The adjusted cash balance should be

$14,737 is the adjusted cash balance.

Explanation:

The cash balance should be adjusted for the information that is provided by the bank at period end and which was not recorded in the company's book of accounts. Information like Deposit in Transit and Outstanding Checks are already recorded in the company's accounts, so there is no need to reconcile this information. However, information like Bank service charges and collection of receivables by bank are something that is not yet recorded and these transactions should be reconciled to reflect their impact on cash balance.

Unadjusted Cash Balance                                     $13,162

Add: Note Receivable                                               1,635

Less: Bank service fees                                              (60)

Adjusted Cash Balance                                       $14,737.

Whereas, the adjusted bank balance which is $14,937 (14.237 + 4,800 - 4,100) differs from adjusted cash balance. There might be some missing information, my experience says that there was a transposition error. The company might have understated its cash account by $200. If that is the case, then that amount needs to be added back to it.

Kindly come back with that missing portion, so that there is no misunderstanding. Thanks!

i think the answer would be b hope this