While preparing a bank reconciliation statement from the passbook overdraft balance, indicate whether the following item will be written in plus or minus column.

(i) Interest allowed by bank.

(ii) Insurance premium paid by bank.

Open in App

Solution

(i) Minus

(ii) Plus

Suggest Corrections

Similar questions

In which column (Plus or Minus) you will write the following while preparing bank reconciliation statement from the credit balance of cash book.

(i) Cheques paid into the bank but not collected.

(ii) Interest on bank overdraft.

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

Find the balance as per cash book from following details:

Debit balance in passbook: Rs 6,700

Direct deposits by customers: Rs 4,800

Bank interest debited by bank: Rs 200

Insurance premium paid by bank: Rs 2,000

Prepare a bank reconciliation statement from the following particulars and show the balance as per cash book.

(i)	Balance as per passbook on December 31, 2017 overdrawn Rs 20,000.
(ii)	Interest on bank overdraft not entered in the cash book Rs 2,000.
(iii)	Rs 200 insurance premium paid by bank has not been entered in the cash book.
(iv)	Cheques drawn in the last week of December, 2017, but not cleared till date for Rs 3,000 and Rs 3,500.
(v)	Cheques deposited into bank on November, 2017, but yet to be credited on dated December 31, 2013 Rs 6,000.
(vii)	Wrongly debited by bank Rs 500.

Q. Interest charged by the bank will be deducted when the overdraft as per pass book is the starting point for preparing the bank reconciliation statement to arrive at the balance as per cash book at the end.

Join BYJU'S Learning Program

While preparing a bank reconciliation statement from the passbook overdraft balance, indicate whether the following item will be written in plus or minus column. (i) Interest allowed by bank. (ii) Insurance premium paid by bank.

(i) Minus (ii) Plus

While preparing a bank reconciliation statement from the passbook overdraft balance, indicate whether the following item will be written in plus or minus column.

(i) Interest allowed by bank.

(ii) Insurance premium paid by bank.

(i) Minus

(ii) Plus