Answered: On 31 december a company cash book…

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter6: Bank Accounts, Cash Funds, And Internal Controls

Section: Chapter Questions

Problem 1PB

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On 31 december a company cash book balance was $11,820 and the bank statement $15,000. the reson for the difference were as follows.

1 Bank charges of $20 not entered in the cashbook.

2 A customer cheque for $200 has been dishonured

3 A payment of $1,200 has been entered in the cashbook as $2,100

4 there were unpresented cheques totalling $6,500

5 Lodgement of $4,000 had not appeared on the bank statement

A) To make appropriate adjustment in the cash book bringing down the correct balance.

B) To prepere a statement reconciling the adjusted balance inthe cash bookwith the balance shown in the bank statement for 31 december

C) Name 3 difference that can accur between the bank statement and cashbook

Definition Definition Financial journal in which only cash-related transactions are recorded. Cash transactions are posted chronologically in the cash book, which is also called a subsidiary book. All the cash receipts are recorded on the debit side and all the cash payments are recorded on the credit side. An important point to remember is that the cash book never shows a credit balance; only a debit balance is shown in the cash book.

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