Question

• Write the procedure documentation for the monthly bank reconciliation process in a professional manner.
  • It will be the desktop guide used by others in the event of your absence to prepare the financial statements for The Gift Shop.
  • It may be in the form of a memorandum or as a numbered listing of items, depending on your individual preference.
• Prepare the monthly bank reconciliation for The Gift Shop based on the information provided.

Additional information needed for bank reconciliation preparation follows:

• Cash per the unadjusted trial balance is $12,675.
• Cash balance per the bank statement is $12,780.
• Check #115 has not cleared the bank. It was written for $645.
• A deposit of $1,000 cleared the bank but was not recorded in the general ledger.
• A check for $250 was found in the owner's desk drawer.
• A deposit of $1,250 was taken to the bank after 2 p.m. on December 31, 2008 and was not posted by the bank until January 1, 2009.
• Errors were noted in the following checks:
  • Check #121 was recorded for $325 but cleared the bank as $320.
  • Check #125 was recorded for $585 but cleared the bank as $600.
  • Bank service charge reported on the bank statement $30.00

Answer 1

monthly bank reconciliation for The Gift Shop is as prepared below:

The Gift Shop
Bank Reconciliation
31-Dec-18
Particulars	Amount ($)	Amount ($)
Balance as per bank		12,780
Add: Deposit in transit	1,250	1250
Less: outstanding checks:
115	645	645
Adjusted cash balance per bank		13385
Cash balance as per books		12,675
Add: Deposit not recorded in ledger	1,000
Add: Error in recording check 121	5	1,005
Less:
Bank Service Charges	30
Error in recording check 125	15
Check not recorded by owner	250	295
Adjusted cash balance as per books		13,385