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Question

On a bank reconciliation which of the following would be added to the balance as per bank statement?

A
Outstanding unpaid cheques.
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B
Deposits in transit.
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C
Cheques not collected.
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D
Both (B) and (C).
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Solution

The correct option is D Both (B) and (C).
In case of deposits in transit and cheques not collected , when these items get cleared they lead to increase in the bank balance and at the present moment the pass book balance would be less than the cash book balance.
So, when preparing a bank reconciliation if balance as per bank statement is the starting point then, deposits in transit and cheques not collected would have to be added.

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