What is the purpose of preparing a bank reconciliation?
What entry should be made if a check received from a customer and deposited is returned by the bank for lack of sufficient funds (an NSF check)?
S.No. | Explanation | ||
1.) | Bank reconciliation is a statement to reconcile the balance as per balance and as per accounts books. we Just enter adjustments in books but only for few items and not all items so we prepare reconciliation statement which can show us the reason behind the difference. These differences are just temporary they will automatically adjusted. | ||
2.) | Items required adjustment is books.: Only those items which are either a error in the accounts books or genuinely required to be enter in books but not yet entered are adjusted. Rest of the items just due to the timing difference are not entered in books. | ||
Account NAME | Debit | Credit | |
Accounts Receivable | xxx | ||
Cash | xxx | ||
(To record NSF Checks) | |||
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