ASB Ltd. received its bank statement for the month ending 30 June, and reconciled the statement
balance to the 30 June balance in the Cash account. The reconciled balance was determined to be
$4800. The reconciliation recognised the following items:
1. Deposits in transit were $2100.
2. Outstanding cheques totalled $3000.
3. Bank service charges shown as a deduction on the bank statement were $50.
4. An NSF cheque from a customer for $400 was included with the bank statement. The firm had
not been previously notified that the cheque had been returned NSF.
5. Included in the cancelled cheques was a cheque actually written for $890. However, it had been
recorded as a disbursement of $980.
Part A: What was the balance in ASB Ltd’s cash account before recognising any of the above reconciling
items? (Show all the necessary steps.)
