Q.On 31 March 2026, the Cash Book of Kavya Traders showed a debit balance of ₹18,500. On comparing with the Bank Pass Book, the following differences were found:
Prepare a Bank Reconciliation Statement as on 31 March 2026, taking the Cash Book balance as the starting point.
Bank Reconciliation Statement of Kavya Traders as on 31 March 2026 (starting from Cash Book balance)
| Particulars | Amount (₹) |
|---|---|
| Balance as per Cash Book | 18,500 |
| Add: Cheques issued but not yet presented for payment | 4,200 |
| Add: Interest allowed by the bank, not yet entered in Cash Book | 300 |
| 23,000 | |
| Less: Cheques deposited but not yet collected | (2,800) |
| Less: Bank charges debited by the bank, not yet entered in Cash Book | (150) |
| Balance as per Pass Book | 20,050 |
Reasoning for each item: (i) A cheque issued but not yet presented has already REDUCED the firm's Cash Book balance, but the bank has not yet deducted it from its own records — so the Pass Book balance is, relatively, HIGHER; it is ADDED. (ii) A cheque deposited but not yet collected has already INCREASED the Cash Book balance, but the bank has not yet added it — the Pass Book balance is, relatively, LOWER; it is SUBTRACTED. (iii) Bank charges have already been deducted by the bank but not yet by the firm — the Pass Book is already lower by this amount, so to move FROM Cash Book TO Pass Book, it must be SUBTRACTED. (iv) Interest allowed has already been added by the bank but not yet by the firm — the Pass Book is already higher by this amount, so it is ADDED.
Balance as per Pass Book (31 March 2026) = ₹20,050.
Unlock everything free for 14 days
- Full step-by-step solutions
- Concept-first explanations
- Methods, shortcuts & mistakes
- PYQ mapping + timed mock tests
Full access for 14 days. No credit card required.