Answer to Accounting Test Question No 3 &4 On Bank Reconciliation Statement

Answer to Accounting Test Question No 3:

Company A

Bank Reconciliation as at 31 st July 2006 $

Balance as per bank statement at 31 st July 2006 55,262

Add: Deposits in transit / Uncredited deposits 1,300

56,562

Deduct:

Unpresented cheques

Check No

6661 dated July 20th $380

6662 dated July 27th 1,050

Adjusted Bank balance at 31 st July 2006 55,512

Balance as per Bank account at 31 st July 2006 55,597

Add: Check no 6666 (Overstated amount) 180

55,777

Deduct:

Bank service charge $55

Dishonored check $210

265

Adjusted Cash balance at 31 st July 2006 55,512

 

Answer to Accounting Test Question No 4:

Part 1 : Preparation of Bank Reconciliation Statement:

Company XYZ

Bank Statement As At 31 st August 2006 $

Step 1: Bank Balance to Corrected Balance

Balance per Bank Statement $74,674

Add: Deposits Outstanding 8,200

Deduct: Checks Outstanding (8,420)

$74,454

Step 2: Book Balance to Corrected Balance

Balance per Book $78,304

Service charges (50)

Automatic monthly transfer (2,000)

Error in recording cash disbursement ($2,000-200) (1,800)

Corrected Cash Balance $74,454

 

Part B: To record credits to cash revealed by the bank reconciliation.

Miscellaneous charges ( bank service charges) $50

Cash-savings account $2,000

Accounts payable $1,800

Cash $3,850

 

[PS: Each adjustment affecting the book balance required journal entries

None of the adjustments to the bank balance require entries. ]

 

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