Question

After obeserving continual discrepancies in the year end bank balance, the mamangement of P Ltd has asked you to prepare the bank reconciliation for the month of May 2020. Following details have been provided to you for the possible causes for the discrepancy.

1 During the month of May, a total of $135,400 cheques were issued, out of which $99,800 were presented for payment to the bank

2 During the month of May, bank of P Ltd. collected $23,150 on its behalf and deducted $280 as the collection fees

3 One of the accounting clerk was sent to the bank to deposit a cheque of $4,800, which he misplaced, and this was never brought to the notice of the bookkeeper

4 There was a incoming transfer of $1,300 which belongs to some other company, and which was deposited to P Ltd. bank account by mistake by the bank.

5 The company purchased raw material for $10,200 on account

6 The purchase department of the company made a payment for the utilities for $282 However, the payment never went through.

7 A cheque of $1540 was deposited into the bank, which was never cleared due to insufficient balance. The bank charged a NSF fees of $20

8 A customer directly dpeosited a cheque of 2300 into company's bank account

9 Accounting clerk was trying to make an online transaction of $417, which got cleared, however, the clerk though it was never cleared

10 There was a payment made for $3340, however, the banking clerk misread it as $3430.

Closing bank balance of the last month as per books was $98,990

Prepare a statement of bank reconciliation to show the bank balance as per bank statement

Answer 1