Concept explainers
(a)
Bank reconciliation: Bank statement is prepared by bank. The company maintains its own records from its perspective. This is why the cash balance per bank and cash balance per books seldom agree. Bank reconciliation is the statement prepared by company to remove the differences and disagreement between cash balance per bank and cash balance per books.
To indicate: The presentation of outstanding checks on
(b)
To indicate: The presentation of debit memorandum by bank (service charge) on bank reconciliation statement.
(c)
To indicate: The presentation of credit memorandum by bank (collection of EFT, electronic funds transfer) on bank reconciliation statement.
(d)
To indicate: The presentation of deposits in transit on bank reconciliation statement.
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Financial Accounting: Tools for Business Decision Making, 8th Edition
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