NCERT Solutions

On March 31, 2017 the cash book showed a balance of ₹ 3,700 as cash at bank, but the bank passbook made up to same date showed that cheques for ₹ 700 , ₹ 300 and ₹ 180 respectively had not presented for payment, Also, a cheque amounting to ₹ 1,200 deposited into the account had not been credited. Prepare a bank reconciliation statement. (Ans : Balance as per passbook ₹ 3,680 )

Bank balance of ₹ 40,000 showed by the cash book of Atul on December 31, 2016. It was found that three cheques of $₹ 2,000$, ₹ 5,000 and ₹ 8,000 deposited during the month of December were not credited in the passbook till January 02, 2017. Two cheques of ₹ 7,000 and ₹ 8,000 issued on December 28, were not presented for payment till January 03, 2017. In addition to it bank had credited Atul for ₹ 325 as interest and had debited him with ₹ 50 as bank charges for which there were no corresponding entries in the cash book. Prepare a bank reconciliation statement as on December 31, 2016. (Ans: Balance as per passbook ₹ 40,275 )

On Ist January 2017, Rakesh had an overdraft of ₹ 8,000 as showed by his cash book. Cheques amounting to ₹ 2,000 had been paid in by him but were not collected by the bank by January 01, 2017. He issued cheques of ₹ 800 which were not presented to the bank for payment up to that day. There was a debit in his passbook of ₹ 60 for interest and ₹ 100 for bank charges. Prepare bank reconciliation statement for comparing both the balance. (Ans: Overdraft as per passbook ₹ 9,360)

Kumar find that the bank balance shown by his cash book on December 31, 2017 is ₹ 90,600 (Credit) but the passbook shows a difference due to the following reason: A cheque (post dated) for ₹ 1,000 has been debited in the bank column of the cash book but not presented for payment. Also, a cheque for ₹ 8,000 drawn in favour of Manohar has not yet been presented for payment. Cheques totaling $₹ 1,500$ deposited in the bank have not yet been collected and cheque for ₹ 5,000 has been dishonoured. (Ans: overdraft as per passbook ₹ 90,100 ).

On December 31, 2017, the cash book of Mittal Bros. Showed an overdraft of ₹ 6,920 . From the following particulars prepare a Bank Reconciliation Statement and ascertain the balance as per passbook. (1) Debited by bank for ₹ 200 on account of Interest on overdraft and ₹ 50 on account of charges for collecting bills. (2) Cheques drawn but not encashed before December, 31, 2017 for ₹ 4,000 . (3) The bank has collected interest and has credited ₹ 600 in passbook. (4) A bill receivable for ₹ 700 previously discounted with the bank had been dishonoured and debited in the passbook. (5) Cheques paid into bank but not collected and credited before December 31, 2017 amounted ₹ 6,000. (Ans: Overdraft as per passbook ₹ 9,170).

State the need for the preparation of bank reconciliation statement?

What is a bank overdraft?

Briefly explain the statement 'wrongly debited by the bank' with the help of an example.

State the causes of difference occurred due to time lag.

Briefly explain the term 'favourable balance as per cash book'.

Enumerate the steps to ascertain the correct cash book balance.

What is a bank reconciliation statement. Why is it prepared?

Explain the reasons where the balance shown by the bank passbook does not agree with the balance as shown by the bank column of the cash book.

Explain the process of preparing bank reconciliation statement with amended cash balance.

I. Read the following transactions and identify the cause of difference on the basis of time gap or errors made by business firm/bank. Put a sign ( ✓ ) for the correct cause.

State whether each of the following statements is True or False