Bank reconciliation exercise and answer
ABC’s Cash Book at 30th November 1982 showed an overdrawn position of £3,630 which did not match with her bank statement. Detailed examination of the two records revealed the following:
(a) The debit side of the cash book had been undercast by £300.
(b) A cheque for £1,560 in favour of Z Suppliers Ltd., had been omitted by the bank from its statement, the cheque having been debited to another customer’s account.
(c) A lodgement of £1080 on 30th November had not been credited by the bank.
(d) Interest amounting to £228 had been debited by the bank but not entered in the cash book.
Required:
Reconcile the balance of the cash book and bank statement to the corrected bank balance.
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Answer
Bank Reconciliation Statement as at 30.11.82
$ $
Balance as per cash book (3630)
Add: Debit side of cash book undercast 300
(3330)
Less: Interest not entered in cash book 228
Balance as per corrected cash book balance 3558
$ $
Balance as per bank statement (3078)
Add: Uncredited deposite (Bank lodgement) 1080
(1998)
Less: Cheque omitted (Bank error) 1560
Balance as per corrected cash book balance (3558)
(a) The debit side of the cash book had been undercast by £300.
(b) A cheque for £1,560 in favour of Z Suppliers Ltd., had been omitted by the bank from its statement, the cheque having been debited to another customer’s account.
(c) A lodgement of £1080 on 30th November had not been credited by the bank.
(d) Interest amounting to £228 had been debited by the bank but not entered in the cash book.
Required:
Reconcile the balance of the cash book and bank statement to the corrected bank balance.
*************************************************************
Answer
Bank Reconciliation Statement as at 30.11.82
$ $
Balance as per cash book (3630)
Add: Debit side of cash book undercast 300
(3330)
Less: Interest not entered in cash book 228
Balance as per corrected cash book balance 3558
$ $
Balance as per bank statement (3078)
Add: Uncredited deposite (Bank lodgement) 1080
(1998)
Less: Cheque omitted (Bank error) 1560
Balance as per corrected cash book balance (3558)
Accurate Bank reconciliation is essential for small businesses to ensure that their financial records match their bank statements. Professional bank reconciliation services help identify discrepancies, prevent errors, and maintain clean accounting records, giving business owners confidence in their financial data.
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