Bank reconciliation Prepare a bank reconciliation as of October 31 from the foll

Question

Bank reconciliation Prepare a bank reconciliation as of October 31 from the following a. The October 31 cash balance in the general ledger is $1,688 b. The October 31 balance shown on the bank statement is $746. c. Checks issued but not returned with the bank statement were No. 462 for $26 and No. 483 for $100 d. A deposit made late on October 31 for $900 is included in the general ledger balance but not in the bank statement balance. e. Returned with the bank statement was a notice that a customer's check for $150 that was f. During a review of the checks that were returned with the bank statement, it was noted that the amount of Check No. 471 was $64 but that in the company's records supporting the general ledger balance, the check had been erroneously recorded as a payment of an account payable in the amount of $46.

Explanation / Answer

Bank Reconciliation statement as of October 31 is as follows:

Reasons:

1. Cheques issued but not returned with the bank statement are those which are credited in our cash book but not withdrawn from our bank account. So bank statement balance will be more. So to reconcile we need to add $126 to cash book balance.

2. Cheque deposited will increase our cash book balance but since it is not deposited with bank our bank statement balance will be less. So to reconcile we need to subtract $900 from cash balance.

3. Customer's cheque would have increased our cash book balance but since it is not deposited our bank statement balance is less. So to reconcile we need to subtract $150 from cash balance.

4. Payment of $64 was erroneously recorded as payment of $46. So our cash balance will be greater than bank statement balance by $64 - $46 =$18. So to reconcile we need to subtract $18 from cash balance.

Particulars Amount Balance as per Cash Ledger $1688 Add: Cheques issued but not returned($100+$26) $126 Less: Deposit made late on october 31 ($900) Less: Customer cheque returned ($150) Less: Remaining payment which was erroneously recorded($64-$46) ($18) Balance as per Bank statement $746

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.