Question

4.The balance of Cash account in the General Ledger of Umar Ltd was $15,190 at 30th...

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

Homework Answers

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
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