Question

Provide two (2) reasons which could lead to the discrepancies between the balances shown in the...

Provide two (2) reasons which could lead to the discrepancies between the balances shown in the bank statement and the cash book. Give examples. [10 marks]

Homework Answers

Answer #1

There are various reason due to which banane as per book and balance as per Bank Statement differ with each other. Below are some examples:

1) Bank charged Charges directly

2) Debtors make payment without informing

3) Cheque issued but not presented for payment

4) Cash in transit etc.

Let's understand this with an easy real life example suppose you issued a cheque to your creditor so you will record this transaction in your book today but creditor may deposit this cheque after a month so till bank statement and cash book will not be same.

I hope this clear your doubt.

Feel free to comment if you still have any query or need something else. I'll help asap.

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