Harris Company had checks outstanding totaling $4,948 on its May bank reconciliation. In June, Harris Company issued checks totaling $41,405. The June bank statement shows that $25,688 in checks cleared the bank in June. A check from one of Harris Company's customers of $348 was also returned marked "NSF." Determine the amount of outstanding checks on Harris Company's June bank reconciliation. Select the correct answer. $20,665 $67,093 $20,740 $20,317

Question

Dereon Page

Business

2 September, 01:47

Harris Company had checks outstanding totaling $4,948 on its May bank reconciliation. In June, Harris Company issued checks totaling $41,405. The June bank statement shows that $25,688 in checks cleared the bank in June. A check from one of Harris Company's customers of $348 was also returned marked "NSF." Determine the amount of outstanding checks on Harris Company's June bank reconciliation. Select the correct answer. $20,665 $67,093 $20,740 $20,317

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Answers (1)

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Beatrice Bridges · Answer 1

The correct option is A,$20,665

Explanation:

The amount to be shown as outstanding checks is made up of the opening outstanding checks plus the checks issued in the current month less checks cleared by the bank in the current month.

Opening balance of outstanding checks is $4,948

Checks in current month $41,405

Checks cleared by the bank ($25,688)

Checks outstanding at month end $20,665

The status of the check returned marked non-sufficient funds still remains the same and cannot be deducted from the computation above until it is finally cleared by the bank or written back to the cash account without reissuing another check in the name of the same beneficiary.