Prepare a Bank Reconciliation Statement as on August 31st, 2022 for ABC Ltd :

(i) Bank overdraft as per Bank Statement — ₹ 17,000
(ii) Cheques issued but not cleared — ₹ 2,200
(iii) Dividend on shares collected by the Bankers — ₹ 2,300
(iv) Interest charged by the Bank not recor

Question

Prepare a Bank Reconciliation Statement as on August 31st, 2022 for ABC Ltd :

(i) Bank overdraft as per Bank Statement — ₹ 17,000
(ii) Cheques issued but not cleared — ₹ 2,200
(iii) Dividend on shares collected by the Bankers — ₹ 2,300
(iv) Interest charged by the Bank not recorded in cash-book — ₹ 500
(v) Cheques deposited but not yet credited by Bank — ₹ 3,400
(vi) Bank charges not recorded in Cash-book — ₹ 100
(vii) Customer deposited directly in the Bank not recorded in Cash-book — ₹ 1,000

OR

From the following transactions prepare Mohd. Aslam's Account :

2022
Jan. 1  Opening Balance (Dr.) — ₹ 10,000
     5  Sold Goods to Mohd. Aslam — ₹ 1,00,000
     6  Received Cash from Mohd. Aslam — ₹ 90,000
    10  Allowed discount to Mohd. Aslam — ₹ 1,000
    15  Goods returned by Mohd. Aslam — ₹ 5,000
    23  Received Cheque from Mohd. Aslam — ₹ 5,000

Accepted Answer

>

> [!TLDR]
> Starting from the Bank Statement overdraft of ₹17,000, the Bank Reconciliation Statement works out to an **Overdraft as per Cash Book of ₹18,500**; the internal-choice alternative (Mohd. Aslam's personal account) closes with a **debit balance of ₹9,000**.
>
> **Bank Reconciliation Statement of ABC Ltd. as on 31st August, 2022** (starting with the balance as per Bank Statement, to find the balance as per Cash Book)
>
> | Particulars | Plus (₹) | Minus (₹) |
> |---|---|---|
> | Overdraft as per Bank Statement | | 17,000 |
> | Add: Cheques deposited but not yet credited by Bank | 3,400 | |
> | Add: Interest charged by Bank not recorded in Cash Book | 500 | |
> | Add: Bank charges not recorded in Cash Book | 100 | |
> | Less: Cheques issued but not yet cleared | | 2,200 |
> | Less: Dividend on shares collected by Bank, not recorded in Cash Book | | 2,300 |
> | Less: Customer deposited directly into Bank, not recorded in Cash Book | | 1,000 |
> | **Overdraft as per Cash Book** | | **18,500** |
>
> **Reasoning for each item** (an overdraft is a credit/unfavourable balance from the firm's point of view, so the logic below tracks whether an item has already reduced the Cash Book balance / increased the overdraft, or the Pass Book balance, before the other book catches up):
> - Cheques **issued but not cleared** (₹2,200): already reduced in the Cash Book (overdraft already larger there) but not yet reflected by the bank — so the Pass Book overdraft understates the true position; **subtract** when moving Pass Book → Cash Book.
> - Cheques **deposited but not yet credited** (₹3,400): already added in the Cash Book (reduces overdraft there) but the bank hasn't credited it yet — Pass Book overdraft overstates the position; **add** to reach the Cash Book figure.
> - **Dividend collected directly by the bank** (₹2,300) and **customer's direct deposit** (₹1,000): the bank has already recorded these as credits (reducing the Pass Book overdraft), but the firm doesn't

Item	Effect on Cash Book	Journal Entry
Interest credited by bank	Increases bank balance	Debit Bank A/c, Credit Interest A/c
Bank charges debited	Decreases bank balance	Debit Bank Charges A/c, Credit Bank A/c
Direct deposit by customer	Increases bank balance	Debit Bank A/c, Credit Customer's A/c
Cheque dishonoured	Decreases bank balance	Debit Customer's A/c, Credit Bank A/c
Direct payment by bank (e.g., insurance premium)	Decreases bank balance	Debit Expense A/c, Credit Bank A/c

Q.Prepare a Bank Reconciliation Statement as on August 31st, 2022 for ABC Ltd :

Concept understanding — Bank Reconciliation Purpose

The Everyday Intuition

The Precise Meaning

Why It Matters

Accounting Treatment

What gets recorded in the Cash Book?

What about the other items? …

Particulars	Plus (₹)	Minus (₹)
Overdraft as per Bank Statement		17,000
Add: Cheques deposited but not yet credited by Bank	3,400
Add: Interest charged by Bank not recorded in Cash Book	500
Add: Bank charges not recorded in Cash Book	100
Less: Cheques issued but not yet cleared		2,200
Less: Dividend on shares collected by Bank, not recorded in Cash Book		2,300
Less: Customer deposited directly into Bank, not recorded in Cash Book		1,000
Overdraft as per Cash Book		18,500

Q.Prepare a Bank Reconciliation Statement as on August 31st, 2022 for ABC Ltd :

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