CB DR BALANCE CB CR BALANCE PB CR NORMAL PB DR UNFAVAROU

NORMAL FAVOURABLE UNFAVourable favourble

Cheques issues but not The amount is deducted The amount is deducted The amount is added to
presented for from the OD CB balance because if the cheques the balance because if
payment CIBUPP because the issue of had been presented for the cheques had been
The amount is added cheques is record in the payment, the balance present for payment,
to the balance CB, in effect the OD cash would have been reduced the OD balance as per
because it had been book balance stands and the two balances the bank would have
earlier deducted from increased. The cheques so would have been the increased++++
the CB balance at the issued are not present for same-----
time of its recording payment, meaning, the
but has not been bank has not debited the
deducted by the bank amount. Thus the
because they have not overdraft balance of the
been presented for bank is lower or the
payment++++ credit balance of the
bank is higher -----
Cheque deposited by The amount is deducted The amount is deducted The amount is added
creditor directly into because the amount is because the entry is not because the bank has
the bank credited by the bank; in recorded in the CB, the credited the account
It is added because effect the OD balance in CB book balance would and in effect the OD
the balance as per the the bank stands have increased.( i.e had it balance stands reduced.
bank already stands decreased. Since the been recorded the two Since the deposit is not
increased but it has cheques directly deposited balance s would have recorded in the CB,
not been added to are not recorded in CB, matched.----- higher OD balance in
the cash book balance the overdraft CB balance the CB is shown++++
because the deposit is is higher than the bank
not recorded in the balance-----
cash book. Adding the
amount will bring it
at par with balance
as per the PB++++
Interest allowed The amount is deducted The amount is deducted The amount is added
,dividend collected by because the entry is not the entry is not recorded because the bank has
bank recorded in the CB , the in the CB , the CB would credited the account
Added because CB balance would have have increased i.e had it and in effect the
already stands increased, i.e had it been been recorded the twos overdraft balance
increased but it has recorded the two balance balance would have stands reduced. Since
not been added to CB would have matched.--- matched---- the deposit is not
because the deposit is recorded in the CB,
not recorded in the higher OD balance in
CB .Adding the the CB is shown++++
amount will bring it
at par with the
balance as per the
PB++++

B/R or cash directly -------------deducted The amount is deducted The amount is added
deposited into the because the entry is not because the bank has
bank but not recorded in the cb, the cb credited the account
recorded in the CB balance would have and in effect the
It added because the increased. (had it been overdraft balance stands
balance as per the recorded the two reduced. Since the
bank already stands balances would have deposit is not recorded
increased but is has matched in the CB, higher
not been added to overdraft balance in the
the CB balance Cash Book is shown.
because the deposit is
not recorded in the
CB .Adding the
amount will bring it
at par with the
balance as per the PB

Wrong credit
granted by the bank
It is added because The amount is deducted The amount is deducted The amount is added
the balance as per because the amount is because the entry is not because the bank shows
bank already stands credited by the bank; in recorded in the CB, the a lower overdraft
increased but is not effect the overdraft CB balance would have balance due to wrong
added to the CB balance stands decreased. increased, i.e had it been credit. Adding the
balance. Adding the The cash book shows a recorded the two amount will increase the
amount will bring it higher overdraft balance balances would have overdraft balance as per
at par with the because the credit is not matched. the bank
balance as per the PB recorded.
But remember, that
entry is not recorded
in the books of
account for wrong
credit granted by the
bank
Cheque deposited but The amount is deducted It is deducted because it The amount is added
not recorded It is because the amount is has not been recorded in because the bank shows
added because bank credited by the bank, in the CB balance is lower a lower overdraft
balance stands effect, the OD balance by that amount balance due to this
increased but CB does Stands decreased .the CB ........................ credit. Adding the
not. Adding the shows a higher OD ...................... amount will increase the
amount to CB balance balance because the .................... overdraft balance as per
will bring it par with cheques deposited are not ................. the bank.
bank balance recorded, ie., the OD ............
balance is not decreased. ................

Less: items
Cheques deposited but The amount is added to The amount is added The amount is deducted
not collected(cleared) the OD amount because because the CB balance from the OD balance
(credited) by bank the bank has not credited already stands increased. because if the cheques
the amount to the By adding the amount, had been collected and
account. Thus, the CB the balance will come at credited to account by
shows a lower OD balance par with the CB balance the bank, it would have
compared to the OD reflected a lower
balance of the bank overdraft balance.
The amount is
deducted because the
CB balance stands
increased but the
bank has not given
credit because it has
not collected it.
Deducting the
amount will bring the
balance at par with
the PB balance
Cheques or bill of The amount is added The amount is deducted
exchange dishonoured because the amount of from the overdraft
deposit already stands balance because the
added to the balance of amount not realised by
the CB but on dishonour, the bank is debited to
the amount is not the account thus in
deducted from the CB effect, reflecting a
balance. By adding the higher overdraft
amount, the balance will balance. At the same
come at par with the CB time, the amount has
 balance. not been recorded in
the CB, thus reflecting a
lower overdraft balance.
It is deducted because
the CB balance stands
increased but the
balance as per the
bank has not
increased because the
cheque or bill of
exchange deposited
has not been
collected. -----------------
Bank charges
charged& interest
charged
The bank has debited The amount is added to The amount is added The amount is deducted
the account by the the OD balance because because the balance of from the OD
charges, thus, the the bank has debited the the bank stands reduced balance has been debited
balance as per the account and in effect but the CB balance is not to the account resulting
bank stands reduced. increased the OD balance. as it is not recorded. By in a higher overdraft
Had it been recorded If the amount had been adding the amount, the balance. At the same
in the CB, the balance recorded in the CB, the balance will come at part time, the amount is not
as per the CB would overdraft balance of the with the CB balance. recorded in the CB thus,
also have been CB would have increased. reflecting a lower
reduced. overdraft balance.
Direct payment by
the bank as per
standing oder,LIC etc
It is deducted because The amount is added to The amount is added The amount is deducted
the balance as per the the OD balance because because the PB balance from the OD balance
bank is reduced. Had the bank has debited the stands reduced but, CB because the amount has
it been also recorded account and in effect balance is not reduced. been debited to the
in the CB, the CB increased the OD balance. By adding the amount, account resulting in a
balance would also If the amount had been the two balances will higher OD balance. At
have been redced. recorded in the CB, the come at par the same time, the
OD balance of the CB amount is not recorded
would have increased. in the CB thus,
reflecting a
lower overdraft balance
Wrong debit by the
bank
It is deducted because The amount is added to The amount is added The amount is deducted
the balance as per the the OD balance because because the balance of from the overdraft
bank is reduced on the bank has debited the the bank is reduced but balance because the
recording. Deducting account and in effect the CB balance is not as amount has been
the amount from the increased the overdraft it is not recorded. By debited to the account
balance as per the CB balance. adding the amount, the resulting in a higher
will bring the balance Adding the amount will balance will come at par overdraft balance. At
at par with the bring the OD balance of with the CB balance. the same time, the
balance as per the the CB at par with the amount is not recorded
bank. But remember bank. in the CB thus,
that entry is not reflecting a lower
recorded in the books overdraft balance.
of account for wrong
debits made by the
bank.
Cheques recorded but
not deposited (not
sent to bank)
It is deducted because The amount is added to The amount is added The amount is deducted
the CB balance stands the amount of OD because, if the cheque had from the OD balance
increased with the because the cheques have been deposited, the because if the cheques
amount. But the bank not been deposited balance of the bank had been collected and
will increase the although they have been would have been equal to credited to account by
balance upon receipt recorded in the CB. In that of the CB. the bank, it would have
of the cheque and its effect, the OD CB balance reflected a lower OD
clearance. Deducting is lower than the OD balance.
the amount will bring balance of the bank
the balance at par. because the bank has not
credited the amount.