Question

4.The balance of Cash account in the General Ledger of Umar Ltd was $15,190 at 30^th September 2020. The bank statement for the business (as at 30^th September) showed a cash balance of $15,670.

On comparing the general ledger and the bank statement, the following differences are identified:
▪ Two cheques used to pay suppliers did not appear on the bank statement.
   ▫ Cheque No. 326, $410
   ▫ Cheque No. 331, $390
▪ The bank has credited $50 interest into Umar Ltd’s account.
▪ The bank statement showed a deduction of $270 for monthly advertising fees. Umar Ltd has not yet processed the September advertising fees.
▪ The accountant of Umar Ltd found that she has incorrectly recorded a $1,000 cash sale made during the month as $100.
▪ $1,000 received by the business from a customer has not yet been deposited with the bank.

Required: Ignore taxes and GST.
Prepare a bank reconciliation statement in the table below (please do not show workings, only include description and final numbers in required cells).

Umar Ltd Cash Ledger Reconciliation Statement As at 30 September 2020
Cash balance in the general ledger
Add
Less
Adjusted cash balance in the general ledger

Umar Ltd Bank Reconciliation Statement As at 30 September 2020
Balance in the bank statement
Add
Less
Adjusted Bank Balance

Answer 1

Solution:

Umar Ltd
Cash Ledger Reconciliation Statement
As at 30 September 2020
Cash balance in the general ledger		15190
Add
Interest earned	50
Incorrect recording of cash sale	900
		950
Less
Advertising fee	270
		270
Adjusted cash balance in the general ledger		15870
Balance in the bank statement		15670
Add
Deposit in transit	1000
		1000
Less
Check 326	410
Check 331	390
		800
Adjusted Bank Balance		15870