Question

The Cash Book of a merchant showed an overdraft balance of ₹ 15,700 on 31st December 2014. On comparing it with the Pass Book, the following differences were noted:
(i) Cheques amounting to ₹ 12,250 were deposited into the bank, out of which cheques for ₹ 7,000 have been credited in the Pass Book on 2nd January, 2015 and one cheque of ₹ 1,200 was returned by the bank on 3rd January as dishonoured.
(ii) Cheques were issued amounting to ₹ 8,300 of which cheques for ₹ 2,000 have been cashed upto 31st Dec.
(iii) A cheque of ₹ 4,250 issued to a creditor, has been entered in the Cash Book as ₹ 4,520.
(iv) Bank charges of ₹ 180 on 30th November 2014 and ₹ 240 on 30th December 2014 have not been entered in the Cash Book.
(v) A B/R for ₹ 6,000 discounted with the bank is entered in the Cash Book without recording the discount charges of ₹ 300.
(vi) A cheque for ₹ 2,000 deposited into the bank appear in the Pass Book, but not recorded in the Cash Book.
(vii) A cheque for ₹ 3,700 deposited into the bank appear in the Pass Book, was recorded in the cash column of the Cash book.
You are required:
(i) to make appropriate adjustments in the cash book, bringing down the correct balance, and
(ii) to prepare a bank reconciliation statement with the adjusted balance.

Answer 1

Adjusted Cash Book (Bank Column only) as onDecember 31, 2014
Dr.									Cr.
Date		Particulars	J.F.	Amount (Rs)	Date	Particulars	J.F.	Amount (Rs)
(iii)		Cheque issued overcasted (4,520 – 4,250)		270		Balance b/d		15,700
(vi)		Customer’s A/c (direct deposit by customer)		2,000	(iv)	Bank Charges A/c (180 + 240)		420
(viii)		Customer’s A/c (cheque not recorded in bank column)		3,700	(v)	Discounting charges A/c (not recorded)		300
		Balance c/d		10,450
				16,420				16,420

Bank Reconciliation Statement as on December 31, 2014
S. No.	Particulars	Plus Items (Rs)	Minus Items (Rs)
	Credit Balance (Overdraft) as per Amended Cash Book		10,450
	Add: (ii) Cheques issued but not presented (8,300 – 2,000)	6,300
	Less: (i) Cheques deposited but not credited (7,000 + 1,200)		8,200
	Debit Balance (Overdraft) as per Pass Book	12,350
		18,650	18,650