From following which is the way to prepare Bank Reconciliation Statement.

Without adjusting cash book balance.

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Before adjusting cash book balance.

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Both of the above

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None of the above

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Solution

The correct option is A Without adjusting cash book balance.
A bank reconciliation statement is prepared to reconcile the differences between the balances as per cash book (bank column) and pass book (bank statement). It is prepared by taking the balance of the cash book without adjusting it as adjusting it will make both the balances match. In such a case bank reconciliation statement will not be required.

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Similar questions

Q. Bank collected dividend of Rs.

25, 000

on behalf of customer which was not recorded in cash book.
In respect of the above given transaction which of the following treatment is correct for preparation of bank reconciliation statement?
(I) If BRS is prepared without adjusting cash book and the balance as per cash book is starting point then Rs.

25, 000

will be subtracted.
(II) If BRS is prepared with adjusted cash book then Rs.

25, 000

will be debited to the adjusted cash book.
(III) If BRS is prepared without adjusting cash book and the balance as per cash book is starting point then Rs.

25, 000

will be added.
(IV) If BRS is prepared with adjusted cash book the Rs.

25, 000

will be credited to the adjusted cash book.

Under Bank reconciliation statement, while adjusting the cash book:

Balance of bank account for preparation of bank reconciliation statement shall be taken from ___ for matching the same with cash book.

Q. While preparing bank reconciliation statement, balance of bank account shall be taken from for matching the same with cash book.

State whether the following Statements are True or False.

1) Bank Reconciliation Statement is prepared by Bank.
2) Bank Reconciliation Statement is prepared at the end of stipulated period.
3) Overdraft facility is allowed to proprietors personal account
4) Debit balance of Pass Book represents overdraft
5) Credit balance of Bank column of Cash Book represents the balance as per Cash book.
6) Bank charges debited by Bank increases bank balance in the Pass Book.
7) Interest credited in Pass Book is an income to the Customer.
8) Bank Reconciliation Statement is prepared to detect the errors the takes place in accounting

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