Sigma's bank statement shows an overdrawn balance of $6,912 at 30 June 2015. A check against the company's cash book revealed the following differences:
1. Bank charges of $4,716 have not been entered in the case book.
2. Lodgements recorded on 30 June 2015 but credited by the bank on 2 July $1,206.
3. Cheque repayments entered in cash book but not presented for payment at 30 June 2015 $750.
4. A cheque payment to a supplier of $440 charged to the account in June 2015 recorded in the cash book as a receipt.
Based on this information, what was the cash book balance before any adjustments? SUGGESTED SOLUTIONS
BANK STATEMENT
| $ | |
| Closing balance OD | (6,912) |
| Add Lodgements | 1,206 |
| Minus cheques not presented | (750) |
| Adjusted Bank balance OD | (6,456) |
| DEBIT | $ | CREDIT | $ |
| Opening balance OD | ??? | ||
| Bank charges | 4,716 | ||
| Error adjustment | 880 | ||
| Closing Balance | 6,456 |
Solve the equation
Answer = $860