- This topic has 6 replies, 3 voices, and was last updated 2 years ago by
.
- Posts
My question as followed:
Bank reconciliation 30 September 20X2:
Balance per bank statement (over draft): 36,840
Add: Lodgerments credited after date: 51,240
Less: Outstanding cheques: 43,620
Balance per cash book (credit): 44460Assuming the amounts stated for items other than the cash book balance are correct, what should the cash book balance be?
I didn’t understand why the author in this question assumes that the amount stated for items other than cash book balance are correct?
I see in the bank reconciliation after corrected all thing we had the balance per cash book is 44460
Is that the answer for this question?But the figures have been added and subtracted the wrong way and so the 44,460 total is wrong.
Your job is to calculate what the correct final total is.Since the bank statement showed an overdraft, the lodgements not credited would turn it into a positive balance of 14,400. The outstanding cheques would then make it overdrawn again to a figure of 29,220.
So the correct balance in the cash account is 29,220 (credit).I do suggest you watch the free lecture on bank reconciliations.
sorry can you explain me why when the bank statement is an overdraft , we have to subtract lodgments and add unpresented cheques
and can how can we adjust the above case that is corret without adjustments.
i think OVERDRAFT is a liability so the LODGMENTS( income) have to subtract OVERDRAFT(liability) and subtract UNPRESENTED cheques => the balance will NEGATIVE and it will be credited right??
And is overdraft and overdrawn the same?
Don’t think in terms of adding and subtracting.
If the bank is an overdraft, then lodgements not yet credited will reduce the amount of the overdraft. Unpresented cheques will increase the overdraft.
Overdraft and overdrawn do mean the same thing.
Have you watched my free lectures on bank reconciliations? The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
- The topic ‘Bank reconciliation’ is closed to new replies.