Question

Banana Company’s bank balance on the bank statement for October 31 of the current year is $12,500. Banana’s accountant is preparing a cash reconciliation and has determined that three cheques issued by Banana to its suppliers for a total of $8,500 have not yet cleared the bank. Also, a deposit for $1,500 made by Banana on October 31 does not appear on the bank statement. Bank service charges of $150 appear on the bank statement but have not yet been recorded in the general ledger.

Required:

• Prepare the cash reconciliation to determine the corrected cash balance that should be reflected in Banana’s general ledger as at October 31.

Answer 1

	Preparation of Cash reconciliation statement for 31st October
Particulars	Amount $	Amount $
	Balance as per Bank Statement		$   12,500
	Balance as per Company's General ledger	$             -
Adjustment to be made in Company's general ledger
Add:	Cheques Issued but not cleared the bank to be added back	$      8,500
Less:	Deposit not appeared in bank statement to be deducted.	$    (1,500)
Less:	Bank charges for october not recorded in Company's general ledger to be deducted.	$       (150)

· Please do upvote if you found the answer useful.

· Feel free to reach in the comment section in case of any clarification or queries.