Question

What is Bank Reconciliation Statement? Explain the causes of disagreement in the balances shown by cash Book and Pass Book.​

Answer 1

It is a statement prepared mainly to reconcile the difference between the bank balance shown by the cash book and bank pass book.

Causes:-

i)cheque issued but not yet presented for payment in the bank.

ii)interest allowed by the bank.

iii)interest charged by the bank on overdraft.

iv)Bank charges and commision charged by the bank.

v) interest and dividened collected by the bank.