4-1 Mark’s First Checking Account During his first year in college, Mark Sutherland opened a……
4-1 Mark’s First Checking Account During his first year in college, Mark Sutherland opened a…
4-1 Mark’s First Checking Account
During his first year in college, Mark Sutherland opened a checking account at the First National Bank of Arlington, Texas. His account does not have a minimum balance requirement, but he does pay a monthly service charge of $3.00. Mark has just received his first monthly bank statement and notices that the end-of-month balance on the statement is quite different from the end-of-month balance he shows in his check register. The bank statement and Mark’s check register are summarized below.
Bank Statement of Activity This Month
ACCOUNT:Mark J. Sutherland ACCOUNT # 43967
PERIOD: January 3, 2011 through January 31, 2011
Beginning Balance 300.00
TotalDeposits and Other Credits to Your Account 300.00
TotalChecks and Other Charges to Your Account 206.25
Ending Balance 93.75
Date
Transaction
03
Deposit
300.00
05
100
16.50
07
101
20.00
09
Debit card transaction
17.45
12
103
42.96
14
104
16.87
17
105
5.00
17
106
11.43
17
ATM
withdrawal
25.00
19
107
25.00
24
108
14.04
28
109
9.00
31
Service charge
3.00
Mark’s Check Register
Date
No.
Payee
For
Amount
Balance
1/3
Deposit
300.00
300.00
1/3
100
Harmon Foods
Food
16.50
283.50
1/4
101
Cash
20.00
263.50
1/5
102
VOID
1/7
103
Mel’s Sporting Goods
Gym shoes
42.96
220.54
1/10
104
Valley Cleaners
Dry cleaning
18.67
201.87
1/13
105
Sharon Mackey
Birthday present
5.00
196.87
1/14
106
University Bookstore
Supplies
11.43
190.44
1/14
107
Cash
25.00
175.44
1/19
108
Harmon Foods
Food
14.04
161.40
1/24
109
Mom
Repay loan
9.00
152.40
1/25
110
Poindexter’s Café
Sharon’s birthday party
20.00
132.40
1/26
Deposit
50.00
182.40
1/28
111
Exxon
Monthly statement
12.96
169.44
1. What are the steps Mark needs to include when reconciling his account register with the bank’s statement?
2. Reconcile Mark’s register with the bank statement using the steps listed in the previous answer.
3. Why are there differences between Mark’s records and the bank’s statement? What could Mark do during the next month to make the month-end reconciliation easier?
4. Suppose Mark finds a $100 deposit in his bank statement that he knows he did not make. What should he do?