A bank reconciliation statement is prepared to reconcile the differences between the balances as per the cash book and as per the bank statement/pass book. It identifies timing differences in recording transactions as well as errors in the cash book or pass book. When preparing a bank reconciliation statement, all errors and omissions in the cash book as well as timing differences between the two statements are taken into consideration.

1. Takshila Learning
Learn anything anywhere
Visit: http://www.takshilalearning.com
Call: +91-8800999280

2. Statement prepared by the Business entity,
Reconciling/Matching the bank balance as per
the cash book(Bank Column) & the Pass
book.
find out the differences between the balances &
nullify them
BRS is prepared by the business entity

3. The Cash Book is prepared by the business
entity
Pass book/Bank Statement is prepared by the
bank to have a record of the customer’s
banking transactions.

5. Bring out errors in Cash book/Pass book
Detection of Undue delay by the bank
Discourages any manipulation by Accountant
Finding out actual position of bank balance

6.  Timing differences : Differences due to
different treatments in Cash & Pass book.
(on different dates)
 Other differences : Difference due to errors in
Cash book.

7. Cheque deposited but not cleared
Cheque issued but not presented for payment
Bank Charges/Interest debited/credited in
bank account.
Direct payment/receipt by bank

8.  Transaction not recorded/twice recorded in
cash book.
 Any other clerical mistake( wrong amount,
wrong casting, etc) in cash book.

10. 1) Without Adjusted Cash Book ( all changes
are done in BRS )
2) With Adjusted Cash Book (the errors of cash
book are rectified in adjusted Cash book &
the timing differences in BRS from the
rectified cash balance)
Note : Adjustments done in Adjusted Cash
book not to be again treated in BRS.

11.  While preparing BRS, the changes
(cancellation of the differences) are:
• to be done in the book from which we have
started
• Keeping in mind the treatment done of the
same transaction in the other book.

12. If the Debit balance as per Cash book (as on
31/12/14) is ` 65,000
a) Cheque of `15,000 was deposited in bank
but not cleared.
b) A cheque of `12,000 was issued but not
presented for payment.
c) Bank charges of `150 was debited.
d) Bank interest of `1600 was credited to the
account.
e) A dividend of `2,000 was received by the
bank from ABC company.

13. Particulars Plus (+) Minus (-)

14. Q.1. A Bank Reconciliation Statement is prepared to
know the causes for the difference between:
The balances as per cash column of Cash Book and the Pass Book
The balance as per bank column of Cash Book and the Pass Book.
T The balance as per bank column of Cash Book and balances as per
cash column of Cash Book
None of the above.
B

15. Q.2. Debit Balance as per Cash Book: ` 2,000, Cheques deposited but not
cleared: ` 100, Cheques issued but not presented: ` 150, Bank allowed
interest: ` 50, Bank collected dividend ` 50. Balance as per Pass Book
will be:
` 2,100
` 1,950
` 2,350
` 2,150
D

16. Q.3. Under bank reconciliation statement, while
adjusting the cash book
All the errors and omissions in the cashbook are taken into consideration
All the errors and omissions in the passbook are taken into consideration
Delays in recording in the passbook due to difference in timing are taken into
consideration
All of the above
A

17. Q.4. While preparing BRS, Starting with over draft balance of cash book, a
cheque of ` 5,500 deposited in bank and duly credited in pass book, but not
recorded in cash book ____ in B.R.S
` 5500 will be added
` 5500 will be subtracted
` 11000 will be added
` 11000 will be subtracted
B

18. Q.5. Bank Overdraft as per Cash Book is ` 10,500
Interest debited by bank ` 3,500 for which advice was not received by account holder.
Cheques deposited but not credited by bank ` 7,500.
Cheques issued but not yet presented ` 9,500.
What is the Overdraft amount as per pass book?
` 12,000
` 16,000
` 5,000
` 9,000
A

19. Q.6. When preparing a Bank Reconciliation Statement if you
start with balance as per Pass Book, then cheques paid by
bank recorded twice in Pass Book ` 1050 will be
Added
Deducted
Not required to be adjusted
None of the three
A

20. Q.7. When money is withdraw from bank ,the bank
Credits customer’s a/c
Debits customer’s A/c
Credits and debits customer’s a/c
None of these
B

21. Q.8. The total payment side of Cash book is Rs. 700
short , if Bank Reconciliation statement is started with
passbook (overdraft )balance then
Rs. 700 will be less
Rs. 700 will be added
Same balance as per cash book
None of these
A

22. Q.9. Mr. Y presented three cheques of Rs.3000,Rs.4500 and Rs.3600 with
the bank on 28th March 2005. Out of these cheques amounting to
Rs.4500and Rs.3000 were shown in the pass book in the month of
April 2005. while reconciling the balance on 31-03-2005 which of these
cheques would be taken in reconciliation
Rs.3600
Rs.3000
Rs.4500 and Rs.3000
Rs.3600 and Rs.3000
C

23. Q.10. overdraft as per Pass book is given Rs. 10,000
Cheques deposited in bank but not recorded in cash book Rs. 100
Cheque drawn not presented for payment Rs. 6,000
Bank charges recorded twice in Cash book Rs. 30
Overdraft as per cash book will be
Rs.16,000
Rs.16,130
Rs. 15,000
None of the three
B