Bank Reconciliation Statement

but not yet collected, and (iii) due to an error in the passbook. The step wise preparation of bank reconciliation statement is shown in figure . . Illustration The following is the summary of a cash book for December, .

Cash Book (Bank Column) Receipts , Balance b/d , Balance c/d , Payments , , , All receipts are banked and payments are made by cheques. On investigation the following are observed: Bank charges of Rs. , entered in the bank statement have not been entered in cash book. Cheques drawn amounting to Rs.

, have not been presented to the bank for payment. Cheques received totalling Rs. , have been entered in the cash book and deposited in the bank, but have not been credited by the bank until January, . A cheque for Rs.

has been entered as a receipt in the cash book instead of as payment. A cheque for Rs. has been debited by the bank in error. .

A cheque received for Rs. has been returned by the bank and marked “No funds available”, no adjustment had been made in the cash book. . All dividends receivable are credited directly to the bank account.

During December, an amount of Rs. was credited by the bank and no entry is made in the cash book. . A cheque drawn for Rs.

has been incorrectly entered in the cash book as Rs. . . The balance brought forward should have been Rs.

. . The bank statement as on December, , showed an overdraft of Rs. , .

(a) You are required to prepare an amended cash book and (b) Prepare a bank reconciliation statement as on Dec. , . Solution Amended Cash Book (Bank column) Dr. Cr.

Date Receipts L.F. Amount Date Payments L.F. Amount Dividends received Balance b/d , Bank charges , Adj. for cheque drawn for Adj.

regarding cheque Rs. entered as Rs. entered as receipt Adj. of balance brought Adj.

regarding cheque forward returned Balance c/d , , , Balance b/d , Bank Reconciliation Statement as on Dec. , Overdraft as per bank statement , Add: Cheque issued but not yet presented for payment , , Less: Cheques deposited but not yet credited , Cheque debited in error , Balance as per cash book , Illustration The bank overdraft of Smith Ltd., on December , as per cash book is Rs. , From the following information, asscertain the adjusted cash balance and prepare bank reconciliation statement (i) Unpresented cheques , (ii) Uncleared cheques , (iii) Bank interest debited in the passbook only , (iv) Bills collected and credited in the passbook only , (v) Cheque of Arun traders dishonoured , (vi) Cheque issued to Kapoor & Co. not yet entered in the of cash book.

Amended Cash Book (Bank Column) Dr. Cr. Date Receipts L.F. Amount Date Payments L.F.

Amount Bills collected as per , Balance b/d , passbook Balance c/d , Interest , Cheque dishonoured (Arun Traders) , Kapoor and Co. (cheque) , , Balance b/d , Bank Reconciliation Statement as on December , Bank overdraft as per cash book , Add Uncleared cheques , , Less Unpresented cheques , Bank overdraft as per passbook , Fig. . : Showing the step wise preparation of bank reconcilation statement