DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH
Name of the Participant : M. Ramakrishna
Designation : Head of Section
Branch : Commercial & Computer Practice
Institute : Govt. Polytechnic for women,
Bheemunipatnam
Year/Semester : I Year
Subject : Accountancy-I
Sub-code : CCP-102
Topic : Bank Reconciliation Statement
Sub Topic : Exercise on
Bank Reconciliation Statement
Duration : 100 Minutes
Teaching aids : Power Point Presentation

CCP102.84-85 1
Objectives

On completion of this period, you would be able to:

 Prepare Bank Reconciliation Statement

 Know causes for disagreement of Cash Book and

Pass Book balances
 Analyze the causes
 Compare the entries
 Adjust the entries in Bank Reconciliation Statement

CCP102.84-85 2
Recap

In the last class, we discussed about

Preparation of Bank Reconciliation Statement
 Causes of disagreement between cash book and
pass book balance
 Comparison of balances
 Reconciliation of balances

CCP102.84-85 3
What are the reasons for disagreement
between the balances of Cash Book and
Pass Book?
 Cheques deposited but not collected
 Cheques issued but not presented for payment
 Cheques/cash directly deposited by customers
 Payments directly made by bank
 Dividends or interest, collected and credited by the
bank
Contd…

CCP102.84-85 4
 Reasons for disagreement (Contd..)

 Commission, bank charges etc., debited by

the banker
 Cheques received debited in the Cash Book, but were
not sent to bank
 Cheques sent to collection dishonoured
 Mistakes in cash book
 Mistakes in pass book

CCP102.84-85 5
Exercise
Prepare Bank Reconciliation Statement as
on 31-12-07
 Balance as per Cash Book Rs.10,000
 The following cheques were deposited, but were
not collected by 31-12-07 i) Sukumar Rs.600
ii) Vijaya Shankar Rs.500 iii) Ajay Kant
Rs.300
 A cheque issued to Vijaya Shankar on 26-12-07
for Rs.1,000 has been presented for payment on
05-01-08.
 The Bank allowed interest of Rs.120 and
charged Rs.30 as expenses.
 A cheque received from Sateesh for Rs.200 has
been deposited in Dec.,07 dishonoured. No
entries were found in cash book for dishonour.
CCP102.84-85 6
Solution
Bank Reconciliation statement
Particulars Amount Amount
Rs. Rs.
Balance as per cash Book 10,000
Add:1.cheques issued but not presented 1000
2.Bank interest not entered in cash
Book 120 1,120

11,120
Less: 1.cheques deposited but cot 1400
collected
2.Bank changes not entered in 30
cash Book
3.cheque deposited 200 1,630
and dishonoured
Balance as per pass book CCP102.84-85 9,490 7
Exercise
Prepare Bank Reconciliation Statement as on 31-12-06
 Balance as per Cash Book Rs.10,500
 The cheques for a) Rs.300 b)500 c)Rs.250 have been
deposited, but not collected as on 31-12-06
 Four cheques issued for Rs.600, Rs.200, Rs.480 and
Rs.60 in Dec,’06, but not presented for cash before the
date of reconciliation
 The bank collected a bill for Rs.1,500 on 31-12-06 but
information was supplied to the trader on 3-1-07
 The bank has given a credit of Rs.800 and charged Rs.100
as its commission for the services rendered

CCP102.84-85 8
Solution
Bank Reconciliation statement
particulars Amount Amount
Rs. Rs
Balance as per cash Book 10,500
Add: 1.cheques issued but not 1340
presented
2. Bill collected by bank 1500
not entered in cash Book
3. Amount credited by bank 800 3,640
14,140
Less:1. Cheques Deposited but 1050
not collected
2. Bank changes Balance as 100 1,150
per pass book
Balance as per pass Book 12,990
CCP102.84-85 9
Assignment
Prepare Bank Reconciliation Statement as on 28-2-07
 Balance as per Pass Book Rs.9,436
 Cheques issued in Feb.’07 were Rs.1,536. Out of which
Rs.496 were cashed in March,07
 The bank has paid Rs.420 to LIC as premium as per the
standing orders. It was not recorded in cash book
 A customer deposited Rs.1,000 directly into our bank
account and not informed us
 Bank charges not recorded in cash book Rs.12
(Balance as per Cash Book: 7,804)

CCP102.84-85 10
Exercise
Prepare Bank Reconciliation Statement as on 31-3-07
 Balance as per Cash Book Rs.8,500
 Cheques deposited but not collected before 31-3-07 are
Rs.1,000
 Interest on debentures collected directly by the bank
Rs.400
 Out of the cheques issued for Rs.5,000in March,07,
cheques for Rs.1,200 have been presented for payment
in April,07
 It was found that the dividend collected by the bank was
Rs.400 for which entry was not recorded in the cash book
 Bank charges Rs.100 were entered in the pass book only
CCP102.84-85 11
Solution
Bank Reconciliation statement
particulars Amount Amount
Rs. Rs
Balance as per cash Book 8,500
Add: 1. Interest on debentures entered in 400
Pass book
2. Cheques issued but not presented 1200
3. Dividend collected by the bank 400
2,000
Less:1. Cheques Deposited but 1000 10,500
not collected
2. Bank changes debited in pass book 100
1,100
Balance as per pass Book
9,400
CCP102.84-85 12
 Exercise
 Prepare Bank Reconciliation Statement as on 31-12-
06
 Balance as per Pass book Rs.8,000
 Cheques issued but not cashed Rs.2,400
 Cheques deposited but not credited before
31-3-06 are Rs.1,000
 An amount of Rs.240 as Insurance premium and
Rs.360 as call on shares has been paid as per
standing orders
 An amount of Rs.1,000 has been deposited by a
debtor in the bank account directly for which no
entry has been made in cash book
CCP102.84-85 13
 Solution
Bank Reconciliation statement
particulars Amount Amount
Rs. Rs
Balance as per Pass Book 8,000
Add: 1. Cheques Deposited but 1,000
not collected
2. Direct payments made by bank 600 1,600

9,600
Less:1. Cheques issued but 2,400
not presented
2. Direct deposit by a customer into 1,000 3,400
bank
Balance as per Cash Book 6,200

CCP102.84-85 14
 Assignment
 Prepare Bank Reconciliation Statement as on 31-12-07
 Balance as per Cash Book Rs.10,000.
 A cheque for Rs.1,000 was deposited on 22-12-07, but the
same was returned by the Bank on 29-12-07 for which no
entry was made in cash book
 Insurance premium paid by the bank Rs.150 was debited
in the pass book only
 Cheques issued for Rs.1,500 in Dec,’07, out of which
Rs.900 cheques were presented for payment before 31-
12-07
 The following transactions were recorded in the pass book
only i) Bank expenses Rs.25 ii) Interest credited
Rs.500
 (Balance as per Pass Book: Rs.9,925)

CCP102.84-85 15
Summary

In this class, we discussed about

Preparation of Bank Reconciliation Statement

 the causes for disagreement of Cash Book

and Pass Book balances

 analyzing the causes
 comparing the entries
 adjusting the entries in Bank Reconciliation
Statement

CCP102.84-85 16