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    Summative Assessment 1 - Question 8

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    Josh
    The bank statement and cash journal are out of order and cheque 770981 for $28.95 has not cleared. A bank reconciliation is needed to reconcile the differences. The reconciliation shows a difference of $128.98 between the cash book balance and reconciled bank balance due to a direct credit not recorded in the cash journal. Adding the $128.98 direct credit to the cash journal reconciles the balances.

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    Summative Assessment 1 - Question 8

    Uploaded by

    Josh
    80 views2 pages
    The bank statement and cash journal are out of order and cheque 770981 for $28.95 has not cleared. A bank reconciliation is needed to reconcile the differences. The reconciliation shows a difference of $128.98 between the cash book balance and reconciled bank balance due to a direct credit not recorded in the cash journal. Adding the $128.98 direct credit to the cash journal reconciles the balances.

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    The bank statement and cash journal are out of order and cheque 770981 for $28.95 has not cleared. A bank reconciliation is needed to reconcile the differences. The reconciliation shows a difference of $128.98 between the cash book balance and reconciled bank balance due to a direct credit not recorded in the cash journal. Adding the $128.98 direct credit to the cash journal reconciles the balances.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    80 views2 pages

    Summative Assessment 1 - Question 8

    Uploaded by

    Josh
    The bank statement and cash journal are out of order and cheque 770981 for $28.95 has not cleared. A bank reconciliation is needed to reconcile the differences. The reconciliation shows a difference of $128.98 between the cash book balance and reconciled bank balance due to a direct credit not recorded in the cash journal. Adding the $128.98 direct credit to the cash journal reconciles the balances.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    Summative Assessment 1

    Question 8 – Reconcile the cash journal and bank statement shown. What differences are
    there between the journal and the statement?

    The first thing I notice is that the bank statements are in a different order compared to the
    journal. The other thing that I notice is that the cheque 770981, for $28.95 has not been
    presented to the bank.

    Since this journal varies from the bank statement, a bank reconciliation report needs to be
    made explaining the variation.

    Bank Reconciliation
    Balance from last bank reconciliation $17,025.46
    Add deposits $750.25
    Less payments $467.40
    Cash book bank balance $17,309.31

    Bank balance as per statement $17,466.24


    Add outstanding deposits
    Less outstanding payments $28.95
    Reconciled balance $17,437.29

    The payments figure of $467.40 is from the cash journal, $28.95, $257.95, $45.50 and
    $135.00 are the total credits for the journal. The deposit figure of $750.25 also comes from
    the cash journal. The outstanding payment of @28.95 is cheque number 770981 which
    hasn’t been presented yet.

    Both the cash book balance and the reconciled bank balance are still not the same amount.
    The cash book balance ($17,309.31) and the reconciled bank balance ($17,437.29) need to
    be subtracted. The difference is $128.98.

    We need to add a direct credit for that amount in the cash journal.

    Date Cheque Details Debit Credit


    14/1/XX 770981 P R Smith and Sons $28.95
    16/1/XX 770982 Car Works $257.95
    16/1/XX 770983 Office Supply Co $45.50
    16/1/XX Deposit Cash and Cheques $750.25
    18/1/XX 770984 Corner Service Centre $135.00
    16/1/XX Dir Deposit Dolling $128.98
    The correct bank reconciliation

    Bank Reconciliation
    Balance from last bank reconciliation $17,025.46
    Add deposits $879.23
    Less Payments $467.40
    Cash book bank balance $17,437.29

    Bank balance as per statement $17,466.24


    Add outstanding deposits
    Less outstanding payments $28.95
    Reconciled balance $17,437.29

    Both the cash book bank balance and the bank balance are both the same, $17,437.29.

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