Honey Hut's unadjusted bank statement balance is $3,000. Outstanding checks amount to $500 and deposits in transit total $300. Based on this information alone, Honey Hut's adjusted cash statement balance is:
subtract checks; add deposits, right?
3000 - 500 + 300 = 2800
the outstanding checks ($500) will take the balance down (-),
the deposits in transit ($300) will take the balance up (+),
he currently has $3,000.
∴Adjusted balance: $3,000 - $500 + $300 = $2,800
To determine the adjusted cash statement balance for Honey Hut, we need to make adjustments for outstanding checks and deposits in transit.
Outstanding Checks:
Outstanding checks refer to checks that have been issued by the company but have not yet been cashed or presented to the bank for payment.
In this case, outstanding checks amount to $500. To adjust the cash statement balance, we need to subtract this amount from the unadjusted bank statement balance:
Unadjusted Bank Statement Balance - Outstanding Checks = Adjusted Cash Statement Balance
$3,000 - $500 = $2,500
Deposits in Transit:
Deposits in transit are payments that have been made by the company but have not yet been recorded by the bank.
In this case, deposits in transit total $300. To adjust the cash statement balance, we need to add this amount to the adjusted balance after adjusting for outstanding checks:
Adjusted Cash Statement Balance + Deposits in Transit = Adjusted Cash Statement Balance
$2,500 + $300 = $2,800
Therefore, based on the information provided, Honey Hut's adjusted cash statement balance is $2,800.