Question

Presented below are the company's records and bank statemnt for April 2018. BANK STATEMENT TO: Nmm Sandler Company Fairbanks Alaska April 30, 2018 FAIRBANKS NATIONAL BANK LE Cash Blance 4/1/18 11,960.00 Deposits & Credits no. Total 9 9,655 Withdrawals & Debits n o. Total 10 6,644 Cash Blance 4/1/18 14,971.00 $ M e HK 4/ 2 E ONIM Deposits and Credits Amount Descr 4/1 1,300 DEP 4/3 1,680 DEP 4/7 1,250 DEP 4/13 1020 DEP 4/18 | 840 DÉP 4/23 | 990 DEP 4/27 1,340 DEPT 4/30 1,160 DEP 4/30 75 INT Withdrawalls and Debits No Amount Desc 804 690 CHK 807 730 CHK 808 1,240 CHK 809 838 CHK 810 1,040 CHK 811 326 CHK 813 640 CHK 814 600 CHK 500 NSE 40 SC 4/16 4/13 4/27 4/23 4/18 4/30 more 16 Item Codes: EC: Error Correction SC: Service Charge IN: Interest Earned DM: Debit Memo OD: Overdraft NSF: Non-sufficient Funds CM: Credit Memo RT: Returned item

what informaiton do i put in the cells ?

what would the bank reconcilation be based on the statement and the cash statment

Answer 1

Bank Reconciliation is prepared to reconcile the balance shown in Cash Book with that of the balance shown in Pass Book or Bank Statement as on a particular date. This statement is prepared to check arithmetical accuracy and to get the entries updated in Cash Books. While making Bank Reconciliation you have to start with Closing balance as on a particular date. You can take the Closing balance of Cash Book or Bank Statement as the base amount to start with. If you start with Cash Book Balance , after making all additions and subtraction you will arrive at balance as per Bank Statement. If you start with Bank Statement balance as base amount you will arrive at Cash Book Balance. In most cases there will be difference between the Cash Book balance & Bank Statement Balance as on a particular date. This is due to many reasons. For example ,suppose the Cash Book is showing a debit balance of 10000 on 31st March but the Bank statement is showing 11000 on same date. When you checked with Cash Book you came to know that cheque issued to one party has been entered in Cash Book but entry is not there in the Bank statement as the same has not been presented for payment yet. In this case if you are making bank reconciliation statement based on cash book balance you have to add it with the balance amount so that your balance will match with Bank Statement. If you have taken Bank Statement balance as the base you have to deduct this amount and you will arrive at the Cash Book Balance.Similarly suppose you have deposited a cheque of 5000 into Bank on 30th March and you have debited the same in Cash Book. But the entry is not there in the Bank statement as the cheque has not been realized yet. In this case you have to deduct it from Cash Book balance so that you will arrive at balance of Bank statement. In some case Bank will debit your Account towards Bank charges or any other payment as per standing instructions given by you to Bank.You were not aware of this debit and hence such entries have not been made in your Cash Book. So in the Bank Reconciliation statement you have to deduct this amount from Cash Book Balances. If Bank has credited your Account towards any direct deposition of money by your customer in your Account, balance as per Bank statement will be showing more. So you have to add such amount in Bank Reconciliation. If you take Bank statement balance as base amount all entries added in the above mentioned cases will be deducted and all the deducted amount will be added in the Bank Reconciliation.In your case you have mentioned about Deposit in transit and delivery charges.

In case of deposit in transit Bank has not credited your Account but you have debited the same in your Cash Book. So you have to deduct it from your Cash Book Balance in Bank Reconciliation statement. Similarly delivery charges paid by you has been credited in your Cash Book but the same has been presented for payment next month. So you have to deduct the same from the balance in Bank reconciliation statement (Considering that you are taking balance as per Cash Book as the base amount).