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Financial accounting I – Bank reconciliation statement
BBA | BBA-BI | BBA-TT | BCIS 1st
PU 2011 Fall Q. No. 6
The following information has been assembled for the purpose of preparing the Apr.30, 2010, bank reconciliation statement of XYZ Company.
a. The balance on the April 30 bank statement was Rs. 18,862; the cash account showed a Rs. 17,250 balance on the same date.
b. A bank services charge of Rs. 25 appears on the bank statement; this charge has not been recorded in the books.
c. Cheques written by XYZ Company which have not yet cleared the bank total Rs. 1,220.
d. A deposit of Rs. 887 appears on the bank statement. The company did not make in book such a deposit.
e. A deposit for Rs. 645 made late on April 30 does not appear on the Bank Statement.
f. A customer’s cheque for Rs. 140 was returned with the bank statement marked “NSF”.
Required:
g. The bank collected Rs. 315 of a customer’s note which includes, Rs. 15 as interest and face value of Rs. 300.
i. The April 30 bank reconciliation statement for XYZ Company. [ 7 ]
ii. How much cash balance to be reported on XYZ Company’s April 30, balance sheet? [2]
iii. Pass the journal entries to adjust the accounts of April 30. [ 6 ]
Solution:
i.
XYZ Company
Bank Reconciliation Statement
As on April 30, 2010
| Particulars | Amount Rs. |
| Balance as per bank statement Add: Deposit in transit Less: Outstanding check | 18,862 645 1,220 |
| Adjusted balance as per bank statement | Rs. 18,287 |
| Balance as per company’s book Add: Note receivable Add: Interest on the note receivable Add: Directly deposited by bank Less: Bank service charge Less: NSF check | 17,250 300 15 887 25 140 |
| Adjusted balance as per company’s book | Rs. 18,287 |
ii. Since the adjusted balance provided by the bank reconciliation statement is Rs. 18,287. Hence, Rs. 18,827 should be reported on XYZ Company’s April 30, on balance sheet.
iii.
Journal Entries
In the book of XYZ Company
April 30
Cash a/c Dr. Rs. 1,202
Note receivable a/c Rs. 300
Interest on note receivable a/c Rs. 15
Deposited by bank a/c Rs. 887
(To record the note receivable, interest on the note receivable, and directly deposited by the bank)
April 30
Bank service charges a/c Dr. Rs. 25
NSF check a/c, Dr. Rs. 140
Cash a/c Rs. 165
(To record the bank service charge and NSF check expenses made by the bank)