The following is a summary from the cash book of the Hozy
Company Limited for October 20X8.
£ £
Opening balance b/f 1,407 Payments15,520
Receipts15,073 Closing balance c/f 960
16,48016,480
On investigation you discover that:
1)Bank charges of £35 shown on the bank statement have not
been entered in the cash book.
2)A cheque drawn for £47 has been entered in error as a
receipt.
3)A cheque for £18 has been returned by the bank marked
'refer to drawer', but it has not been written back in the cash
book.
4)An error of transposition has occurred in the opening
balance in that the cash book should have been carried down at
£1,470.
5)Three cheques paid to suppliers for £214, £370 and £30 have
not yet been presented to the bank.
6)The last page of the paying-in book shows a deposit of
£1,542 which has not yet been credited to the account by the
bank.
7)The bank has debited a cheque for £72 in error to the
company's account.
8)The bank statement shows an overdrawn balance of
£124.
REQUIRED:
a)Show what adjustments you would make in the cash
book;
b)Prepare a bank reconciliation statement as at 31 October
20X8.