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Bank reconciliation statement
A bank is a financial institution that creates money by lending money to borrowers, generating corresponding deposits on its balance sheet. Cash books and pass books are accounting records used by banks and customers. A bank reconciliation statement reconciles the balance in a cash book to the balance in a pass book, accounting for discrepancies like outstanding deposits or checks. Common reconciling items include checks that have been deposited but not cleared, checks issued but not cashed, bank charges, interest earned, and direct payments made by the bank.
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Bank reconciliation statement
- 2. BANK A Bank isa financial intermediary and money creator that creates money by lending money to a borrower, thereby creating a corresponding deposit on the bank's balance sheet.
- 3. The cash booksare simple accounting books that are used to enter basic data about cash payments and receipts. CASH BOOK & PASS BOOK
- 4. CASH BOOK &PASS BOOK FORMAT
- 5. BALANCING OF CASHBOOK AND PASS BOOK Balance
- 6. NOT BALANCING OFCASH BOOK AND PASS BOOK
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- 9. PARTICULARS AMOUNTS AMOUNTS Balanceas per Cash Book 200 Bank Reconciliation Statement as on Dec 31, 2003 Example sum of BRS , Pg. no.206
- 10. PARTICULARS AMOUNTS AMOUNTS Balanceas per Cash Book LESS: Cheques deposited but not credited by the bank 1,500 200 Bank Reconciliation Statement as on Dec 31, 2003 CASH BOOK PASS BOOK 100 100 (+) 1500 - 1600 100≠(-) 1. Cheques deposited but not yet collected by the bank Rs. 1,500
- 11. PARTICULARS AMOUNTS AMOUNTS Balanceas per Cash Book ADD: Cheques issued to Mr.Raju but not presented for payment 2,500 2,500 200 Bank Reconciliation Statement as on Dec 31, 2003 CASH BOOK PASS BOOK 3000 3000 (-)2500 - 500 3000 (+) ≠ 2. Cheque issued to Mr.Raju has not yet been presented for payment Rs. 2,500
- 12. PARTICULARS AMOUNTS AMOUNTS Balanceas per Cash Book LESS: Bank charges as per pass book 200 200 200 Bank Reconciliation Statement as on Dec 31, 2003 CASH BOOK PASS BOOK 500 500 - 200 (-) 500 300 (+) ≠ 3. Bank charges debited in the pass book Rs.200
- 13. PARTICULARS AMOUNTS AMOUNTS Balanceas per Cash Book ADD: Interest allowed by the bank 100 200 Bank Reconciliation Statement as on Dec 31, 2003 CASH BOOK PASS BOOK 500 500 - 100 (+) 500 600 (-) ≠ 4. Interest allowed by the bank Rs.100
- 14. PARTICULARS AMOUNTS AMOUNTS Balanceas per Cash Book LESS: Insurance premium directly paid by the bank as per standing instructions 500 200 Bank Reconciliation Statement as on Dec 31, 2003 CASH BOOK PASS BOOK 1000 1000 - 500 (-) 1000 500 (+) ≠ 5. Insurance premium directly paid by the bank as per standing instructions Rs.500
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- 18. Assignment - go throughthe example sum - do the exercise sum 1 & 2 - write any two cases of disagreement between the balance shown by the cash book & pass Book
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