Mayo Inc.’s bank statement from Western Bank at August 31, 2007, gives the following

Mayo Inc.’s bank statement from Western Bank at August 31, 2007, gives the following information.
Balance, August 1 $16,400 Bank debit memorandum:
August deposits 73,000 Safety deposit box fee $ 25
Checks cleared in August 68,660 Service charge 50
Bank credit memorandum: Balance, August 31 20,710
Interest earned 45
A summary of the Cash account in the ledger for August shows the following: balance, August 1, $16,900; receipts $77,000; disbursements $73,570; and balance, August 31, $20,330. Analysis reveals that the only reconciling items on the July 31 bank reconciliation were a deposit in transit for $5,000 and outstanding checks of $4,500. In addition, you determine that there were two errors involving company checks drawn in August: (1) A check for $400 to a creditor on account that cleared the bank in August was journalized and posted for $40. (2) A salary check to an employee for $275 was recorded by the bank as $257.
Instructions
(a) Prepare a bank reconciliation at August 31.
(b) Journalize the adjusting entry(ies) to be made by Mayo Inc. at August 31.

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