XYZ Co. has a cash balance per books of \$12,000. Outstanding checks total \$1,500, and deposits in transit are \$2,000. The bank statement shows a service charge of \$50 and a customer’s NSF check of \$200, both not yet recorded in the books. What is the adjusted cash balance per the books?

• A. \$13,250
• B. \$11,750
• C. \$12,250
• D. \$10,250

Answer: (B)

Verified step by step guidance

1. Step 1: Start with the cash balance per books, which is \$12,000.
2. Step 2: Deduct the bank service charge of \$50 from the cash balance per books, as it has not yet been recorded in the books.
3. Step 3: Deduct the NSF (Non-Sufficient Funds) check of \$200 from the cash balance per books, as it also has not yet been recorded in the books.
4. Step 4: Add the deposits in transit of \$2,000 to the cash balance per books, as these are amounts that have been recorded in the books but not yet reflected in the bank statement.
5. Step 5: Deduct the outstanding checks totaling \$1,500 from the cash balance per books, as these are checks issued by the company that have not yet cleared the bank.