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The bank statement of Hugo showed a debit balance of $12,800. The bank reconciliation showed there were outstanding lodgements of $3,400 and unpresented cheques of $4,700.
What is the correct amount of cash that should be recorded in Hugo’s accounts?
can u explain this i didnt get the whole question
The bank statement is showing an overdraft of 12,800.
The outstanding lodgements will reduce the overdraft and the unpresented cheques will increase the overdraft. The end result will be the correct balance that should be appearing in their cash account.
This is all explained in 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.