Anonymous
Feb 13, 2024
Open adjusted cash book and bank reconciliation?
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Feb 13, 2024
An adjusted cash book is a financial record that reflects any changes or adjustments made to the cash book balance. These adjustments can include correcting errors, recording outstanding checks or deposits, and accounting for any other discrepancies.
A bank reconciliation is the process of comparing the cash book balance with the bank statement balance to ensure they match. It involves identifying and explaining any differences between the two balances, such as outstanding checks, deposits in transit, bank fees, and errors.
To open an adjusted cash book and perform a bank reconciliation, follow these steps:
1. Gather the cash book and bank statement for the relevant period.
2. Compare the opening balances of the cash book and bank statement. Ensure they match.
3. Review the cash book entries and identify any errors or discrepancies. Make necessary adjustments to correct these errors.
4. Compare the cash book entries with the bank statement transactions. Tick off the transactions that appear in both records.
5. Identify any outstanding checks or deposits in transit. These are transactions that have been recorded in the cash book but have not yet cleared the bank.
6. Add any outstanding deposits to the cash book balance and deduct any outstanding checks from the cash book balance.
7. Account for any bank fees or charges that may have been deducted by the bank. Adjust the cash book balance accordingly.
8. Reconcile any other differences between the cash book and bank statement, such as errors or unrecorded transactions.
9. Once all adjustments have been made, compare the adjusted cash book balance with the bank statement balance. They should now match.
10. Prepare a bank reconciliation statement or report to document the adjustments made and explain any remaining differences between the two balances.
Performing regular bank reconciliations is crucial for ensuring the accuracy of financial records and detecting any errors or fraudulent activities. It helps to identify any discrepancies and maintain the integrity of the cash book and bank statement balances.
A bank reconciliation is the process of comparing the cash book balance with the bank statement balance to ensure they match. It involves identifying and explaining any differences between the two balances, such as outstanding checks, deposits in transit, bank fees, and errors.
To open an adjusted cash book and perform a bank reconciliation, follow these steps:
1. Gather the cash book and bank statement for the relevant period.
2. Compare the opening balances of the cash book and bank statement. Ensure they match.
3. Review the cash book entries and identify any errors or discrepancies. Make necessary adjustments to correct these errors.
4. Compare the cash book entries with the bank statement transactions. Tick off the transactions that appear in both records.
5. Identify any outstanding checks or deposits in transit. These are transactions that have been recorded in the cash book but have not yet cleared the bank.
6. Add any outstanding deposits to the cash book balance and deduct any outstanding checks from the cash book balance.
7. Account for any bank fees or charges that may have been deducted by the bank. Adjust the cash book balance accordingly.
8. Reconcile any other differences between the cash book and bank statement, such as errors or unrecorded transactions.
9. Once all adjustments have been made, compare the adjusted cash book balance with the bank statement balance. They should now match.
10. Prepare a bank reconciliation statement or report to document the adjustments made and explain any remaining differences between the two balances.
Performing regular bank reconciliations is crucial for ensuring the accuracy of financial records and detecting any errors or fraudulent activities. It helps to identify any discrepancies and maintain the integrity of the cash book and bank statement balances.
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Ebisa Nugusie
Mar 29, 2024
Project of bank reconciliation statement question and answer
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Anonymous
Dec 23, 2024
Question Five
On 31 January 2024 David Jones balanced his cash book and brought down a debit balance of TZs 114,000 on 1 February. The bank statement showed a credit balance of TZs 154,000 on 31 January 2024.
A comparison of the cash book and the bank statement revealed the following.
Items appearing only in the cash book Cash from sales paid into the bank on 28 January
TZs 235000
Cheque paid to M Sharp, a credit supplier
490,000
Items appearing only on the bank statement
Bank charges 62,000
Cheque received from K Taylor, a credit customer, dishonoured 143,000
Insurance premium paid by standing order
40,000
Interest on deposit account paid directly into the bank 130,000
The total of the debit side of the cash book had been overcast 100000
REQUIRED
(a) Update the cash book of David Jones. Bring down the updated bank balance on 1 February 2024
(b) Prepare a bank reconciliation statement for David Jones at 31 January 2024.
On 31 January 2024 David Jones balanced his cash book and brought down a debit balance of TZs 114,000 on 1 February. The bank statement showed a credit balance of TZs 154,000 on 31 January 2024.
A comparison of the cash book and the bank statement revealed the following.
Items appearing only in the cash book Cash from sales paid into the bank on 28 January
TZs 235000
Cheque paid to M Sharp, a credit supplier
490,000
Items appearing only on the bank statement
Bank charges 62,000
Cheque received from K Taylor, a credit customer, dishonoured 143,000
Insurance premium paid by standing order
40,000
Interest on deposit account paid directly into the bank 130,000
The total of the debit side of the cash book had been overcast 100000
REQUIRED
(a) Update the cash book of David Jones. Bring down the updated bank balance on 1 February 2024
(b) Prepare a bank reconciliation statement for David Jones at 31 January 2024.
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