Question

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Answer 1

Answer:

Hi !!

Bank reconciliation statements are prepared when you have to reconcile some of the statement that are either left to be recorded in cash book or pass book

In cash book your accountant has full control and only he can excersice the left entries in it

In pass book the bank has full control and in that bank can only do the entries

But due to some reasons entry are left to be recorded in either of books

Examples:-

Cheque deposited but not credited by bank:-

Here cheque are deposited by the person so in cash book he will debit them in bank column but bank would only credit them when they are received so here amount in cash book will be more than pass book

Answer 2

Answer:

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steps

• The first step is to compare opening balances of both the bank column of the cash book as well as bank statement; these could be different due to un-credited or un-presented cheques from a previous period.

• Now, compare credit side of the bank statement with debit side of the bank column of cash book and debit side of the bank statement with the credit side of the bank column of the cash book. Place a tick against all the items appearing in both the records.

• Analyze the entries both in the bank column of the cash book as well as pass book and look for entries which have been missed to be posted in the bank column of the cash book. Make a list of such entries and make the necessary adjustments in the cash book.

• Correct if any mistakes o errors

appear in cash book.

• Calculate the corrected and revised balance of cash book’s bank column.

• Now, start bank reconciliation statement with updated cash book balance.

• Add the un-presented cheques (cheques which are issued by the business firm to its creditors or suppliers but not presented for payment – Expense) and deduct un-credited cheques (Cheques paid into the bank but not yet collected – Income).