- 12 Marks
FA – L1 – Q57 – Bank reconciliations
Question
Following information has been collected from the books of Newman & Co, as at August 31, 20X9:
(a) Balance as per bank book
(b) Cash balance on bank statement
(c) Cheques outstanding on August 31 were as follows:
| Cheque No. | GH¢ |
|---|---|
| 670 | 13,353 |
| 679 | 14,152 |
| 690 | 17,108 |
| 996 | 3,535 |
| 997 | 14,430 |
| 999 | 23,629 |
(d) The company made the following payments into the bank in the last week in August but these had not yet appeared on the bank statement.
| GH¢ |
|---|
| 83,250 |
| 144,641 |
(e) The following matters have been discovered.
(i) Receipt of GH¢15,000 was erroneously recorded on the credit side of the bank book.
(ii) A payment of GH¢12,480 was erroneously recorded on the debit side of the bank book.
(iii) The credit side of the bank book has been overcasted by GH¢4,800.
(iv) The bank statement showed an amount collected by the bank but not shown in the cash book in the amount of GH¢87,188.
Required
Prepare the bank reconciliation as at 31 August.
Answer
Newman & Co
Bank reconciliation statement (correct) as at August 31, 20X9
| GH¢ | |
|---|---|
| Balance as per bank statement | 118,686 |
| Add undeposited receipts (83,250 + 144,641) | 227,891 |
| Less unpresented cheques | (86,207) |
| Adjusted balance as per bank statement | 260,370 |
| Balance as per cash book | |
| Errors in the cash book: | |
| Receipt of GH¢15,000 entered as payment | 30,000 |
| Payment of GH¢12,480 entered on the receipt side | 24,960 |
| Error in casting on the credit side | 4,800 |
| Collection of bill receivable by the bank | 87,188 |
| Adjusted balance as per cash book | 260,370 |
- Tags: Adjustments, Bank reconciliation, Bank statement, Cash book, Cheques, Errors, Financial accounting, Overdraft
- Level: Level 1
- Topic: Bank reconciliations
- Uploader: Samuel Duah