This document contains sample questions and answers about bank reconciliation statements. It begins with 15 multiple choice questions about concepts such as defining a bank statement, calculating balances based on bank and cash book information, and identifying reconciling items. The document then provides two word problems asking to prepare full bank reconciliations based on given financial information.

1. Principles of Accounting
(ACC 111)
Bank Reconciliation Statement
GHIAS UL HASSAN KHAN
M B A , ACC A , A I C S , M C E , M I E
P H D – I N P RO G R ES S
PRACTICE

2. Answers
MCQs
1 B
2 B
3 C
4 A
5 C
6 B
7 6.450 O/D
8 B
9 B
10 D
11 A & C
12 B
13 A
14 -11,200
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3. Question 1
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4. Question 2
Which of the following correctly defines a 'bank statement’?
A. A statement produced to agree the balance at bank with the cash book balance for a business
B. One sent to customers of a bank itemizing the account balances, payments and receipts for an
account in a month
C. A record showing the cash balance of a business
D. An analysis of payments and receipts for a business
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5. Question 3
XYZ has a bank statement showing an overdrawn balance of $300. The cash book shows a
balance in hand of $25, interest charged was $30 which had not been recorded in the cash book.
There were no unpresented cheques. How much was the total of undeposited receipts cheques?
A. $245
B. $325
C. $295
D. $355
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6. Question 4
The cash book of XYZ showed a balance in hand of $900. The bank statement showed a credit
balance of $1,100. Cheques paid in but not yet credited to the bank statement were $250. The
unpresented cheques amounted to?
A. $450
B. $50
C. $250
D. $200
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7. Question 5
Which of the following will not appear in a bank reconciliation statement?
A. Unpresented cheques
B. Undeposited receipts
C. Journal entries
D. Bank errors
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8. Question 6
Your cash book at 31 December 20X3 shows a bank balance of $565 overdrawn. On comparing this with your bank
statement at the same date, you discover the following.
1 A cheque for $57 drawn by you on 29 December 20X3 has not yet been presented for payment.
2 A cheque for $92 from a customer, which was paid into the bank on 24 December 20X3, has been dishonored on 31
December 20X3.
What is the correct bank balance to be shown in the statement of financial position at 31 December 20X3?
A. $714 overdrawn
B. $657 overdrawn
C. $473 overdrawn
D. $53 overdrawn
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9. Question 7
The cash book shows a bank balance of $5,675 overdrawn at 31 August 20X5. It is subsequently
discovered that a standing order for $125 has been entered twice, and that a dishonored cheque
for $450 has been debited in the cash book instead of credited.
What is the correct bank balance?
$_________ overdrawn.
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10. Question 8
The bank statement on 31 October 20X7 showed an overdraft of $800. On reconciling the bank statement, it
was discovered that a cheque drawn by your company for $80 had not been presented for payment, and that
a cheque for $130 from a customer had been dishonored on 30 October 20X7, but that this had not yet been
notified to you by the bank.
What is the correct bank balance to be shown in the statement of financial position at 31 October 20X7?
A. $1,010 overdrawn
B. $880 overdrawn
C. $750 overdrawn
D. $720 overdrawn
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11. Question 9
The following information relates to a bank reconciliation. (i) The bank balance in the cashbook before taking the items below into
account was $8,970 overdrawn.
(ii) Bank charges of $550 on the bank statement have not been entered in the cashbook.
(iii) The bank has credited the account in error with $425 which belongs to another customer.
(iv) Cheque payments totalling $3,275 have been entered in the cashbook but have not been presented for payment.
(v) Cheques totalling $5,380 have been correctly entered on the debit side of the cashbook but have not been paid in at the bank.
What was the balance as shown by the bank statement before taking the above items into account?
A. $9,520 overdrawn
B. $11,200 overdrawn
C. $9,520 in credit
D. $11,200 in credit
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12. Question 10
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A. $44,460 CREDIT as
stated
B. $60,020 CREDIT
C. $29,220 DEBIT
D. $29,220 CREDIT

13. Question 11
Listed below are some possible causes of difference between the cash book balance and the
bank statement balance when preparing a bank reconciliation.
Which TWO of these items require an entry in the cash book?
A. Cheque paid in, subsequently dishonored
B. Error by bank
C. Bank charges
D. Lodgments credited after date
E. Cheques not yet presented
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14. Question 12
In preparing a company's bank reconciliation statement at March 20X3, the following items are causing
the difference between the cash book balance and the bank statement balance:
1 Bank charges $380
2 Error by bank $1,000 (cheque incorrectly debited to the account)
3 Lodgments not credited $4,580
4 Unpresented cheques $1,475
5 Direct debit $350
6 Cheque paid in by the company and dishonored $400
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Which of these items will require an
entry in the cash book?
A. 2, 4 and 6
B. 1, 5 and 6
C. 3 and 4
D. 3 and 5

15. Question 13
Which of the following statements about bank reconciliations are correct?
1 A difference between the cash book and the bank statement must be corrected by means of a journal entry.
2 In preparing a bank reconciliation, lodgments recorded before date in the cash book but credited by the bank after date
should reduce an overdrawn balance in the bank statement.
3 Bank charges not yet entered in the cash book should be dealt with by an adjustment in the bank reconciliation
statement.
4 If a cheque received from a customer is dishonored after date, a credit entry in the cash book is required.
A. 2 and 4
B. 1 and 4
C. 2 and 3
D. 1 and 3
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16. Question 14
The following information relates to a bank reconciliation.
(i) The bank balance in the cashbook before taking the items below into account was $8,970 overdrawn.
(ii) Bank charges of $550 on the bank statement have not been entered in the cashbook.
(iii) The bank has credited the account in error with $425 which belongs to another customer.
(iv) Cheque payments totaling $3,275 have been entered in the cashbook but have not been presented for
payment.
(v) Cheques totaling $5,380 have been correctly entered on the debit side of the cashbook but have not been
been paid in at the bank.
What was the balance as shown by the bank statement before taking the items above into account?
$________ overdrawn
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17. Question 15
The following information pertains to Crane Video Company.
1. Cash balance per bank, July 31, $7,263.
2. July bank service charge not recorded by the depositor $28.
3. Cash balance per books, July 31, $7,284.
4. Deposits in transit, July 31, $1,300.
5. Bank collected $700 note for Crane in July, plus interest $36, less fee $20. The collection
has not been recorded by Crane, and no interest has been accrued.
6. Outstanding checks, July 31, $591.
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Prepare bank
reconciliation
and adjusting entries.

18. Answer
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Cash Book Bank Statement
Balances 7,284 7,263
Bank charges (28)
Deposit in transit 1,300
Collection by bank 736
Collection charges (20)
Outstanding cheque (591)
Total 7,972 7,972

19. Question 16
On May 31, 2017, Reber Company had a cash balance per books of $6,781.50. The bank statement from New York State Bank on that date showed a balance of
$6,404.60. A comparison of the statement with the Cash account revealed the following facts.
1. The statement included a debit memo of $40 for the printing of additional company checks.
2. Cash sales of $836.15 on May 12 were deposited in the bank. The cash receipts journal entry and the deposit slip were incorrectly made for $886.15. The bank
credited Reber Company for the correct amount.
3. Outstanding checks at May 31 totaled $576.25. Deposits in transit were $2,416.15.
4. On May 18, the company issued check No. 1181 for $685 to Lynda Carsen on account. The check, which cleared the bank in May, was incorrectly journalized
and posted by Reber Company for $658.
5. A $3,000 note receivable was collected by the bank for Reber Company on May 31 plus $80 interest. The bank charged a collection fee of $20. No interest has
been accrued on the note.
6. Included with the cancelled checks was a check issued by Stiner Company to Ted Cress for $800 that was incorrectly charged to Reber Company by the bank.
7. On May 31, the bank statement showed an NSF charge of $680 for a check issued by Sue Allison, a customer, to Reber Company on account.
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Prepare bank
reconciliation
and adjusting entries.

20. GHIAS UL HASSAN KHAN 12/17/2023 20
Cash Book Bank Statement
Balances 6,781.50 6,404.60
Paid by bank (debit memo means) (40.00)
Wrong sales enter (Added more) (50.00)
Outstanding cheque (576.25)
Deposite in transit 2,416.15
Incorrectly less deduct (27.00)
Collection by bank 3,080.00
Collection charges (20.00)
Incorrectly deducted by bank 800.00
NSF (680.00)
Total 9,044.50 9,044.50

21. Thanks & continue to the next part
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