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The bank reconciliation is a statement used to remove the errors between book balance and bank balance.

1. The outstanding check amount is deducted from the bank balance because it is already deducted from the book balance, but the bank has not yet deducted this from the bank balance.
2. The amount of $1,500 of deposit transit is added to the bank balance because this amount has already been added to the book balance but has not yet been added to the bank balance.
3. The NSF check is subtracted from the book balance because NSF shows an insufficient balance in the customer's bank account.
4. The amount of notes receivable and interest is added to the book balance because the bank directly collects this amount from the customer.
5. The interest earned on the bank balance is added to the book balance because it increases the amount of cash.
6. The service charge of $10 is subtracted from the book balance because the bank directly deducts it from the bank balance.
7. The $1,800 is added to the bank balance because the bank credited the wrong amount.
8. In this case, $350 was added to the bank balance.