Page 262 - DMGT104_FINANCIAL_ACCOUNTING

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( )
Overdraft as per the bank statement
56,740
Add: Particulars Amount Amount
Cheques issued to supplier not yet presented 1,54,320
Dividend received by the bank not yet intimated 15,740
1,70,060
Financial Accounting
2,26,800
Deduct:
Cheques deposited not yet credited by the bank 2,06,200
Notes Cheque received from a customer wrongly credited by the
bank in Andersen & Co. A/c 64,720
Bank charges not yet recorded 1,400
2,72,320
Bank balance (debit) as per the cash book 45,520

You may notice here that the nature of the balance is reversed (overdraft to favourable)
because the deductions are more than the additions or, to put it simply, the balance is
reversed if you get a negative figure.
Illustration 4: From the following particulars, prepare Bank Reconciliation statement of Rajesh
as on 31st December 2006.

(a) Balances as per cash book on 31st December 2006 4,250.
(b) Cheques for 3,100 were issued during the month of December, but only cheques for
1,400 were presented for payment during December.

(c) Cheque and cash amounting to 5,900 were deposited in the bank during the month of
December but credit was given only for 3,450.
(d) The bank paid during December 2006 a sum of 495 as life insurance premium.

(e) The bank credited 100 as interest and debited 45 as bank charges, for which there were
no corresponding entries in the cash book.
Solution:

Bank Reconciliation Statement of Rajesh as on December 31, 2006.

Bank balance as per Cash Book 4250
Add: Cheque issued but not yet presented for payment 1700
Interest credited only in the pass book 100 1800
6050
Less: Cheque deposited but not yet credited by the book 2450
Life insurance premium debited only in the pass book 495
Bank charges debited only in the pass book 45
2990
Bank balance as per Pass Book 3060

Illustration 5: From the following transactions prepare Bank Reconciliation Statement as on
March 31, 2007 of a firm.
(a) Bank balance as per pass book 9,800.
(b) A cheque of 5,000 deposited into bank on March 26, 2007, was credited in the first
week of April.
(c) Cheque issued to a creditor 7,000 on March 28, 2007 was presented to the bank on
April 8, 2007.
(d) A cheque of 2,000 deposited into the bank was found dishonoured but the entry of
dishonour is pending in the cash back.

(e) A cheque of 3,000 issued to Mr. Alex was dishonored due to the difference in the
amount mentioned in words, but the entry of dishonour is not yet done in the cash
book.

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