Bank Reconciliation Statement | Solved example 2
Rocky’s Cash Book (Bank Column only) for the month of June 2008 was as follows:
Dr. |
| ($) | Cr. |
| ($) |
June 1 | Balance b/f | 600 | June 3 | Tim | 90 |
June 14 | Cash | 225 | June 19 | Sam | 270 |
June 26 | Roby | 60 | June 23 | Rakesh | 1050 |
June 30 | Balance hint1 | 450 |
|
|
|
|
| 1410 |
|
| 1410 |
The following Bank Statement was received in early July 2008:
2008 | Details | Payments | Receipts | Balance |
June 1 | Balance brought forward |
|
| 520 |
1 | Error corrected-contra 31 May | hint 2 | 80 | 600 |
14 | Cash |
| 225 | 825 |
15 | Tim | 90 |
| 735 |
20 | Banker’s Order-fire insurance | 85 |
| 650 |
21 | Sam | 270 |
| 380 |
26 | Roby |
| 60 | 440 |
29 | Unpaid cheque –Roby | 60 |
| 380 |
30 | Dividend |
| 90 | hint 3 |
You may assume that the bank balance was successfully reconciled at the end of March.
- Bring the Cash Book up to date, starting with the balance at 30 June 2008.
- Prepare a Statement, under its correct title, to reconcile the difference between your amended Cash Book balance and the balance in the Bank Statement on 30 June 2008.
- State the amount of the up-dated bank balance.hint 4
Hint 1
This is a credit balance i.e. an overdraft
Hint 2
This entry has already appeared in Cash Book in May. Note the date 31 May. Note also the difference between opening balance in Cash Book ($600) and opening balance in Bank Statement ($520) is $80. So no adjustments in June.
Hint 3
This is a credit balance. A credit balance in Bank Statement is equivalent to a debit balance in Cash Book.
Hint 4
Updated means, after all necessary adjustments have been made.
Solution
1. Cash Book
2008 | ($) | ($) | |||
June 30 | Dividend | 90 | June 30 | Balance b/f | 450 |
| Balance c/f (adjusted) | 505 |
| Bankers’ Order | 85 |
|
|
|
| Dishonoured Cheque | 60 |
|
| 595 |
|
| 595 |
2. Bank Reconciliation Statement
($) | |
Balance as per Bank Statement (Credit) | 470 |
Add Uncredited Deposits | 75 |
| 545 |
Less Unpresented Cheques | 1050 |
Balance as per Cash Book (Credit) | 505 |
3. The amount of the up-dated balance is $505 (credit balance as per Cash Book)
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