Financial accounting I – Reconciliation statement
BBA | BBA-BI | BBA-TT | BCIS 1st
PU 2015 Fall Q. No. 15
In December 31st, Amod Co.’s bank statement showed a balance of Rs. 7,000. On this date the cash account in the company’s ledger disclosed a balance of Rs. 7,090. The review related as:
a. Cheques under collection on Dec.31, Rs. 500.
b. Outstanding cheques for Rs. 200.
c. A cheque for Rs. 2,100 issued to supplier was recorded by bank as Rs. 2,010.
d. A bill receivable of Rs. 500 and interest of Rs. 30 collected by the bank have not been recorded in company’s account.
e. A cheque for Rs. 100 received from customer was returned by bank due to NSF reason.
f. Service charge charged by bank Rs. 10.
g. In accordance with the company’s standing instruction on Dec.31, the bank paid insurance premium of Rs. 300 for company’s car. This does not appear in the company’s book.
ii. The necessary journal entries. 
Bank Reconciliation Statement
As on December 31
|Balance as per bank statement|
Add: Deposit in transit
Less: Outstanding checks
Less: Errors in recording
|Adjusted balance as per bank statement||Rs. 7,210|
|Balance as per company’s book|
Add: Bill receivable
Add: Interest on bill receivable
Less: NSF check
Less: Bank service charge
Less: Insurance premium paid by bank
|Adjusted balance as per company’s book||Rs. 7,210|
In the book of Amod Company
Cash a/c Dr. Rs.
Bill receivable a/c Rs. 500
Interest on bill receivable a/c Rs. 30
(To record the bill receivable and interest on bill receivable collected by the bank)
NSF check a/c, Dr. Rs. 100
Bank service charges a/c Dr. Rs. 10
Insurance premium a/c Dr. Rs. 300
Cash a/c Rs. 410
(To record the NSF check, bank service charge, and insurance premium made by the bank)
Also, know about
The checks which are written by the company but not make payment by the bank are called outstanding checks. As outstanding checks are not debited or not paid by the bank, these checks should be deducted from the balance of bank statement.