Bank Reconciliation Statement - PowerPoint Presentation

1. Bank Reconciliation Statement

2. Bank Reconciliation StatementBank reconciliation statement is a statement that Account holder (depositors) prepare to find, explain and understand any differences between the balance in bank statement and the balance in their accounting records.

3. Bank Reconciliation StatementCauses of DifferenceCheques issues to suppliers not yet presented for payment.Cheques deposited to the bank for collection.Cheques received by the bank directly not yet intimated.Insurance premium paid by the bank as per standing instructions not yet intimated.Dividend received by the bank directly. Bank charges not yet intimated.Cheques dishonoured but not yet intimated.

4. Bank Reconciliation Statement as on……………ParticularsAmount (Rs.)Amount (Rs.)ABalance as per Cash Book ***BAdd:Cheques issued but not presented for payment***   Interest credited by bank but not recorded in cash book***   Debtors directly paid into bank but not recorded in cash book***   Wrongly credit by banker***   Collections by banker as per customer standing instructions***   Total B ***C (Total A + B) ***DLess:Cheques deposited but not credited by the bank***   Dishonoured cheques appeared in the pass book but not entered in the cash book***   Bank charges as per pass book***   Wrong debit by banker***   Payments as per standing instructions***   Total (D) ***  Balance as per pass book (C- D) ***

5. Q.No 1From the following particulars, prepare a Bank Reconciliation Statement for Jindal Offset Ltd.Balance as per Cash Book is Rs. 2,40,000.Cheques issued but not presented in the bank amounts to Rs. 1,36,000.Cheques deposited in bank but not yet cleared amounts to Rs. 90,000.Bank charges amount to Rs.300.Interest credited by bank amounts to Rs. 1,250.The balance as per Pass Book if Rs.2,86,950

6. Q.No 2From the following particulars of Mr. Vinod, prepare bank reconciliation statement as on March 31, 2010.1. Bank balance as per cash book Rs. 50,000.2. Cheques issued but not presented for payment Rs. 6,000.3. The bank had directly collected dividend of Rs. 8,000 and credited to bank accountbut was not entered in the cash book.4. Bank charges of Rs. 400 were not entered in the cash book.5. A cheques for Rs. 6,000 was deposited but not collected by the bank.

7. Answer:

8. Q.No 3From the following particulars of Anil & Co. prepare a bank reconciliation statement as on August 31, 2010.1. Balance as per the cash book Rs. 54,000.2. Rs. 100 bank incidental charges debited to Anil & Co. account, which is not recordedin cash book.3. Cheques for Rs. 5,400 is deposited in the bank but not yet collected by the bank.4. A cheque for Rs. 20,000 is issued by Anil & Co. not presented for payment.

9. Answer

10. 5.4

11. BRS – Method 2 (Pass Book Balance to Cash Book Balance) On 31st March 2017, the Bank Pass Book of Namrata showed a balance of Rs.1,50,000 to her credit while balance as per cash book was Rs. 1,12,050. On scrutiny of the two books, she ascertained the following causes of difference:She has issued cheques amounting to Rs. 80,000 out of which only Rs. 32,000 were presented for payment.She received a cheque of Rs. 5,000 which she recorded in her cash book but forgot to deposit in the bank.A cheque of Rs. 22,000 deposited by her has not been cleared yet. Mr. Gupta deposited an amount of Rs. 15,700 in her bank which has not been recorded by her in Cash Book yet.Bank has credit an interest of Rs. 1,500 while charging Rs.250 as bank charges.Prepare Bank Reconciliation Statement.Q1

12. BRS – Method 2 (Pass Book Balance to Cash Book Balance) Q1ANSParticularsAmount (Rs.)Balance as per Pass Book (Cr.)1,50,000Add: Cheque deposited but not yet cleared22,000Add: Cheque recorded in Cash Book but not yet deposited5,000Add: Bank Charges debited by Bank250Less: Cheque issued but not yet presented(48,000)Less: Amount deposited but not recorded in Cash Book(15,700)Less: Interest allowed by Bank(1,500)Balance as per Cash Book1,12,050Bank Reconciliation Statement as on 31st March 2017

13. Method II: Pass Book Balance to Cash Book BalancePrepare Bank Reconciliation statement as on December 31, 2009. On this day the passbook of Mr. Himanshu showed a balance of Rs. 7,000.(a) Cheques of Rs. 1,000 directly deposited by a customer.(b) The bank has credited Mr. Himanshu for Rs. 700 as interest. (c) Cheques for Rs. 3000 were issued during the month of December but of these cheques for Rs. 1,000 were not presented during the month of December.(d) Cheque deposited into bank but not cleared Rs.2500Q2

14. Method II: Pass Book Balance to Cash Book BalanceQ2ANSParticularsAmount (Rs.)Balance as per Pass Book (Cr.)7000Add: Cheque deposited but not yet cleared25009500Less: Cheques issued but not presented for payment(1000)Less: Cheques directly deposited(1000)Less: Interest credited by the bank(700)Balance as per Cash Book6800Bank Reconciliation Statement as on 31st March 2009

15. Method II: Pass Book Balance to Cash Book BalanceMrs.Jame’s pass book showed a balance of Rs 25,000 on June 30, 2003. Her cash book shows a different balance. On examination, it is found that1. No record has been made in the cash book for a dishonour of a cheque for Rs.2502. Cheques paid into bank amounting to Rs. 3,500 were paid into thebank on June 28, 2003 and the same had not been entered in the pass book.3. Bank charges of Rs. 300 have not been entered in the cash book.4. Cheques amounting to Rs. 9,000 issued to Ms.Devi has not been presented for payment still.5. Mr. Balu who owed Rs. 3,000 has directly paid the sum into the bank account.Q3

16. Method II: Pass Book Balance to Cash Book BalanceQ3ANSParticularsAmount (Rs.)Balance as per Pass Book 25,000Add: Cheques paid into bank not collected3500Add: Dishnonour of Cheque not recorded in Cash Book250Add: Bank Charges not entered in the Cash Book30029050Less: Cheques issued but not presented for payment(9000)Less: Amount directly paid by Mr.Balu(3000)Balance as per Cash Book17050Bank Reconciliation Statement as on 30 June, 2003

17. Method II: Pass Book Balance to Cash Book BalanceQ4ParticularsAmount (Rs.)Balance as per Pass Book 12600Cheques issued but not presented for payment900Cheques deposited in bank but not collected1200Bank paid insurance premium500Direct Deposit by a Customer800Interest on Investment collected by bank200Bank charges100Balance as per Cash Book12500Prepare a bank reconciliation statement of Mr.Goutham from the following data as on 31.12.2003.

18. Method III: Overdraft Cash Book Balance to Overdraft Pass Book BalanceQ1ParticularsAmount (Rs.)Bank overdraft as per cash book1,10,450Cheques issued on June 20, 2003 but not yet presented for payment15,000Cheques deposited but not yet credited by bank22750Bills receivable directly collected by bank47200Interest on overdraft debited by bank12115Amount wrongly debited by bank2400Prepare a Bank Reconciliation Statement as at June 30, 2018 for M/s. Jothi Sales Private Limited from the information given below

19. Method III: Overdraft Cash Book Balance to Overdraft Pass Book BalanceQ1ANS

20. Method III: Overdraft Cash Book Balance to Overdraft Pass Book BalanceQ2a) The bank overdraft as per Cash Book on 31st December, Rs. 1,26,800.b) Interest on overdraft for 6 months ending 31st December, Rs.3,200 is entered in the Pass Book.c) Bank charges of Rs.600 for the above period are debited in the Pass Book.d) Cheques issued but not cashed prior to 31st December, amounted to Rs.23,360e) Cheques paid into bank but not cleared before 31st December, were for Rs. 43,400.f) Interest on investments collected by the bank and credited in the Pass Book, Rs. 24,000.From the following particulars, ascertain the balance that would appear in the Bank Pass Book of Cotton World Ltd. at 31st December, 2018.

21. Q2ANSParticularsAmount (Rs.)Amount (Rs.)Bank overdraft as per Cash Book 1,26,800Add: Interest on overdraft 3,200Add: Cheques paid into bank but not cleared 43,400Add: Bank Charges not entered in the Cash Book60047,200174000Less: Cheques issued but not cashed23,360Less: Interest on investments collected by the bank and credited 24,00047360Bank Overdraft as per Pass Book126640Bank Reconciliation Statement as on 31st December, 2018Method III: Overdraft Cash Book Balance to Overdraft Pass Book Balance

22. On 30th June 2014, the Cash Book of a trader shows a bank overdraft of Rs. 2,500. Following information's are available:-Method III: Overdraft Cash Book Balance to Overdraft Pass Book BalanceQ31. Cheques amounting to Rs. 14,600 had been paid to the bank, but of these only Rs. 12,200 were credited in the Pass Book, up to 30th June, 2014.2. He had also issued cheques amounting to Rs. 10,000, out of which only Rs. 6,400 had been presented for payment.3. A cheque of Rs. 500 which he had debited to the bank account was not sent to bank for collection by mistake.4. There is a debit in the Pass Book of Rs. 10 for Bank Charges and Rs. 50  for interest.5. A customer directly paid into his bank Rs. 1,000, but it was not shown in the Cash Book.6. Bank has paid insurance premium of Rs. 400 according to his instructions, but this is not recorded in the Cash Book.Prepare a Bank Reconciliation Statement.

23. Method III: Overdraft Cash Book Balance to Overdraft Pass Book BalanceQ3ANSParticularsAmount (Rs.)Amount (Rs.)Bank overdraft as per Cash Book 2,500Add: Cheques paid into bank but not cleared (14,600-12,200)2,400Add: Bank Charges10Add: Bank Interest50Add: Cheque not sent to bank for collection500Add: Insurance Premium paid by bank4003,3605,860Less: Cheques issued but not cashed (10000-6,400)3,600Less: Amount Directly deposited by Customer1,0004,600Bank Overdraft as per Pass Book1,260Bank Reconciliation Statement as on 30th June, 2014

24. Method IV: Overdraft Pass Book Balance to Overdraft Cash Book BalanceQ1a) Cheques worth Rs.1,400 paid into the Bank had not been collected till 31st Octoberb) Cheques worth Rs. 720 issued before 31st October had not been presented for payment.c) Interest on Overdraft Rs. 110 charged by the Bank was not entered in the Cash Bookd) A Bill Receivable worth Rs. 800 discounted on 1st September was dishonourede) A customer had paid into the Bank directly Rs. 450 and this was not entered in the Cash Book.The Pass Book of M/s.EL Enterprises showed that he had an Overdraft of Rs.8,000 on 31st October, 2018. On verification of the Cash Book and the Bank Pass Book the following points were noticed:

25. Q1ANSParticularsAmount (Rs.)Amount (Rs.)Bank overdraft as per Pass Book 8000Add: Cheques issued but not presented for payment720Add: Customer paid directly to the Bank450Add: Bills discounted is dishonored80019709970Less: Cheques paid into bank but not cleared 1400Less: Interest on Overdraft1101510Bank overdraft as per Cash Book 8460Bank Reconciliation Statement as on 31st October, 2018Method IV: Overdraft Pass Book Balance to Overdraft Cash Book Balance

26. Method IV: Overdraft Pass Book Balance to Overdraft Cash Book BalanceQ2My bank Pass Book showed an overdraft of Rs. 8,500 on 31st March, 2017. This does not agree with the Cash Book balance. From the following particulars ascertain the Cash Book balance:-Cheques amounting to Rs. 15,000 were paid into bank in March, out of which, it appears, only cheques amounting to Rs. 4,500 were credited by bank. Cheques issued during March amounted in all to Rs. 11,000. Out of these cheques for Rs. 3,000 were unpaid on 31st March, 2017. The Pass Book stands debited with Rs. 150 for interest and with Rs. 30 for bank charges. The bank had paid the annual subscription of Rs. 100 to my club according to my instructions. The entries for interest, bank charges and subscription have not yet been made in Cash Book.

27. Method IV: Overdraft Pass Book Balance to Overdraft Cash Book BalanceQ2ANSParticularsAmount (Rs.)Amount (Rs.)Bank overdraft as per Pass Book 8500Add: Cheques issued but not presented for payment3000300011500Less: Cheques deposited but not credited10500Less: Bank Charges interest150Less: Bank Charges30Less: Club Subscription paid by Bank10010780Bank overdraft as per Cash Book 720Bank Reconciliation Statement as on 31st March, 2017

28. Prepare the Bank Reconciliation Statement from the following particulars for the period ending 31st December, 2012.(a) Overdraft as per Pass Book on 31-12-2012 Rs. 7,600.(b) Cheques deposited but not collected by the bank Rs. 3,560.(c) Incidental charges not recorded in Cash Book Rs. 80.(d) Cheques were issued for Rs. 7,800 but only Rs. 4,400 were presented for payment.(e) Insurance premium paid by bank not recorded in the Cash Book Rs. 4,200.(f) On 31st December, 2012 cash was deposited in bank Rs. 385 but the cashier debited the bank column with Rs. 485 by mistake.Method IV: Overdraft Pass Book Balance to Overdraft Cash Book BalanceQ3

29. Method IV: Overdraft Pass Book Balance to Overdraft Cash Book BalanceQ3ANSParticularsAmount (Rs.)Amount (Rs.)Bank overdraft as per Pass Book 7,600Add: Cheques issued but not presented for payment34003,40011000Less: Cheques deposited but not credited3,560Less: Incidental Charges paid by Bank80Less: Insurance premium paid by Bank4,200Less: Amount wrongly entered in Cash Book (485-385)1007940Bank overdraft as per Cash Book 3060Bank Reconciliation Statement as on 31st December, 2012

30. Prepare a Bank Reconciliation Statement from the following particulars:-On 31st December 2014, I had an overdraft of Rs. 750 as shown by my Pass Book. I had issued cheques amounting to Rs. 250 of which Rs. 200 worth only seem to have been presented for payment. Cheques amounting to Rs. 100 had been paid in by me on 30th December, but of these only Rs. 75 were credited in the Pass Book. I also find that a cheque for  Rs. 10 which I had debited to bank account in my books has been omitted to be banked. There is a debit of  Rs. 25 in my Pass Book for interest.An entry of Rs. 30 of a payment by a customer direct into the bank appears in the Pass Book. My Pass Book also shows a credit of Rs. 60 to my account for interest on investments directly collected by my bankers.Method IV: Overdraft Pass Book Balance to Overdraft Cash Book BalanceQ4

31. Method IV: Overdraft Pass Book Balance to Overdraft Cash Book BalanceQ4ANSParticularsAmount (Rs.)Amount (Rs.)Bank overdraft as per Pass Book 750Add: Cheque issued but not presented for payment50Add: Amount Deposited by Customer30Add: Interest on Investment60140890Less: Cheque deposited but not credited25Less: Cheque recorded in cash book but not sent to bank10Less: Interest charged by Bank2560Bank overdraft as per Cash Book 830Bank Reconciliation Statement as on 31st December, 2014