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The following data was taken from a firm’s bank reconciliation statement: book balance, $7,910; deposit in transit, $150; NSF check from a customer, $200; outstanding checks, $5,000; bank service charge, $10. Its adjusted book balance is

Question

The following data was taken from a firm’s bank reconciliation statement: book balance, 7,910;depositintransit,7,910; deposit in transit, 150; NSF check from a customer, 200;outstandingchecks,200; outstanding checks, 5,000; bank service charge, $10. Its adjusted book balance is

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Solution

To calculate the adjusted book balance, we need to start with the book balance and then adjust it for any deposits in transit, NSF checks, outstanding checks, and bank service charges. Here's how to do it:

  1. Start with the book balance: $7,910
  2. Add any deposits in transit: 7,910+7,910 + 150 = $8,060
  3. Subtract any NSF checks: 8,0608,060 - 200 = $7,860
  4. Subtract any outstanding checks: 7,8607,860 - 5,000 = $2,860
  5. Subtract any bank service charges: 2,8602,860 - 10 = $2,850

So, the adjusted book balance is $2,850.

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