Tutorial 10 Bank Reconciliation Statement 1 LTJ 2018

Tutorial 10: Bank Reconciliation Statements 27 CR Deposits 7,876.90 36,322.50

28 TRF 9,406.00 26,916.50
Section A
29 INT (Loan account) 111.90 26,804.60
1. Explain what a current account is. 30 Bank charges 73.70 26,730.90
2. Explain the purpose of a bank statement and describe the information 30 Cheque No:32521 6,421.30 20,309.60
that is shown in it. 30 BCE 20,309.60
3. Explain the purpose of preparing bank reconciliation statements.
4. What is the meaning of an unpresented cheque and uncredited Abbreviations
lodgement? BCE = Balance SO = Standing Order
5. State the possible reasons why the cash book and bank statement TRF = Transfer CR = Credit/Deposit
balances are different. Give example for each reason. DD = Direct Debit INT = Interest

Question 6 The Bank Account (General Ledger account) for the month of April 2018 was
as follows:
In early May 2018, Superb Trading received a statement from the bank for the
month of April 2018, as shown below: Bank Account
Apr RM Apr Chq. No. RM
Statement of Account with Maybank Bhd for the month of April 2018
1 Balance b/d 2,669.10 3 Maxx Bhd 32516 250.80
April Description Debit Credit Balance
1 Stylo Co. 534.00 4 Jeff Trading 32517 317.20
RM RM RM
1 Emerge Ltd 628.50 8 Besto Ltd 32518 1,218.60
1 BCE 5,773,40
2 Hot Tea Bhd 187.60 9 Lucky Trading 32519 13,742.90
2 Cheque No:32515 851.60 4,921.80
15 Chin Hup Fatt 17,934.80 11 Loan interest 100.80
5 Cheque No:32514 1,003.40 3,918.40
20 Mann Motors 24,043.70 (March 2018)
8 Cheque No:32516 250.80 3,667.60
24 Luther Trading 4,181.20 13 Ace Trading 32520 103.50
12 DD (Max Insurance) 262.60 3,405.00
25 Chan & Chan 3,695.70 20 Zess Deco 32521 6,421.30
13 CR Deposits 17,934.80 21,339.80
24 Next Trading DD 320.00
13 Cheque No:32518 1,218.60 20,121.20
26 Harrier Trading 32522 904.40
15 Cheque No:32519 13,742.90 6,378.30
27 Salaries TRF 9,406.00
18 Cheque No:32517 317.20 6,061.10
28 Stationery 32523 43.00
22 DD (Indah Water) 320.00 5,741.10
30 Balance c/d 21,046.10
22 CR Deposits 24,043.70 29,784.80
53,874.60 53,874.60
23 Cheque No:32520 103.50 29,681.30
26 SO 1,235.70 28,445.60 May
1 Balance b/d 21,046.10
Tutorial 10 Bank Reconciliation Statement 2 LTJ 2018

Required: Abbreviations:
BAL = Balance; CHG = Charges; CLR CHQ = Clearing cheque;
(a) Reconcile the opening balances of the Bank Account and the Bank CR = Credit; DD = Direct Debit; SO = Standing Order
Statement.

(b) Adjust the Bank Account and prepare a Bank Reconciliation Statement as
at 30 April 2018. Cash Book (bank columns only)
2017 RM 2017 Chq. No. RM
Question 7
Oct 1 Balance b/d 1,778.16 Oct 7 Purchases 802328 283.40
Mr Thana provides the following information for the month of October 2017: 2 Roland Lim 984.70 Electricity 802329 287.64
Bank Statement as at 31 October 2017 14 Sales 699.00 10 Purchases 802330 175.54
Debit Credit Balance
Date Description 19 Sales 688.40 13 Rental 802331 60.00
RM RM RM
29 Donny & Co 385.60 14 Travelling 802332 118.18
01.10.2017 BAL 2,229.98
31 Sales 400.00 18 Salaries 802333 762.36
03.10.2017 CLR CHQ 802327 421.40 1,808.58
28 Purchases 802334 104.54
06.10.2017 CR 984.70 2,793.28
29 Rates 802335 340.00
06.10.2017 CLR CHQ 802326 30.42 2,672.86 31 Balance c/d 2,804.20
07.10.2017 CHG 25.60 2,737.26 4,935.86 4,935.86
09.10.2017 CLR CHQ 802329 287.64 2,449.62 Nov 1 Balance b/d 2,804.20
10.10.2017 SO 38.94 2,410.68
12.10.2017 CLR CHQ 802328 283.40 2,127.28
Required:
13.10.2017 DD 65.04 2,062.24
14.10.2017 CR 699.00 2,761.24 (a) Show how the opening balances will be reconciled.
14.10.2017 CLR CHQ 802330 155.74 2,605.50 (b) Update the Cash Book where necessary.
16.10.2017 CLR CHQ 802332 118.18 2,487.32
(c) Prepare a Bank Reconciliation Statement for Mr Thana as at 31 October
18.10.2017 CR 42.94 2,530.26 2017.
19.10.2017 CR 688.40 3,218.66
20.10.2017 CLR CHQ 802333 762.36 2,456.30
31.10.2017 BAL 2,456.30
Tutorial 10 Bank Reconciliation Statement 3 LTJ 2018

Extra exercise questions (for students’ own practice)

Question 1 Question 2

The Bank Account (General Ledger account) and the Bank Statement of The following is the Cash Book (bank columns only) of Pyramid Enterprise for
Excellent Enterprise for September 2017 are as follows: the month of July 2017:

Bank Account Cash Book

2017 RM 2017 RM 2017 RM 2017 RM
Sep 1 Balance b/d 6,816 Sep 6 Chatles 450 Jul 5 Jason 310 Jul 1 Balance b/d 8,311
8 Summit Ltd 474 13 Jack Trading 1,299 19 Champion Bhd 378 9 Subang medical 412
17 Alex Loh 279 17 Frontway Bhd 264 30 Landfill Ltd 422 18 Ban Enterprise 630
26 Maxim Sdn Bhd 921 27 Cahaya Trading 171 31 Balance c/d 8,411 28 Popular Book Store 168
29 Next Enterprise 1,872 30 Balance c/d 8,178 9,521 9,521
10,362 10,362 Aug 1 Balance b/d 8,411
Oct 1 Balance b/d 8,178
The Bank Statement as at 31 July 2017 is as follows:
Bank Statement as at 30 September 2017
Dr Cr Balance Dr Cr Balance
2017 RM RM RM 2017 RM RM RM
Sep 1 Balance b/f 6,816 Jul 1 Balance b/d 8,311 O/D
8 Deposit 474 7,290 6 Deposit: Jason 310 8,001 O/D
9 Cheque 450 6,840 12 Cheque: Subang medical 412 8,413 O/D
17 Deposit 279 7,119 19 Deposit: Champion Bhd 378 8,035 O/D
18 Cheque 1,299 5,820 21 Ban Enterprise 630 8,665 O/D
19 Cheque 264 5,556 25 Pacific Insurans Co 400 9,065 O/D
26 Deposit 921 6,477 28 Credit transfer: Kanvas Ltd 360 8,705 O/D
27 Standing order 132 6,345 31 Bank charges 130 8,835 O/D
29 Credit transfer 270 6,615
30 Bank charges 210 6,405
Required:

Required: (a) Write up the Cash Book up-to-date to take the necessary items into account.

(a) Write up the Bank Account up-to-date to take the above into account. (b) Draw up a Bank Reconciliation Statement for Pyramid Enterprise as at 31
July 2017.
(b) Draw up a Bank Reconciliation Statement as at 30 September 2017.
Tutorial 10 Bank Reconciliation Statement 4 LTJ 2018

Question 3

The following are the Bank Statement and Cash Book of McBowel Sdn Bhd.
Both are extracted from the month of September 2017.

Bank Statement as at 30 September 2017 Cash Book (bank columns only)

Date Debit Credit Balance 2017 RM 2017 Chq. No. RM
Sept RM RM RM Sept 1 Balance b/d 1,539 Sept 4 Aman & Co 8533 300
01 Balance b/f 2,169 3 Raja Co 4,890 10 Travelling 8534 3,240
Credit Transfer 390 2,559 4 Sales 208,200 14 Purchases 8535 156,090
9 Fixture 9,150 26 Rental 8536 1,530
02 Cheque No: 8531 1,020 1,539
28 Omar Trading 1,170 28 Salaries 8537 3,000
03 Giro credit: Raja Co 4,890 6,429
29 Purchases 8538 30,150
04 Deposit 208,200 214,629
30 Balance c/d 30,639
Cheque No: 8533 300 214,329 224,949 224,949
09 Credit transfer 9,150 223,479 Oct 1 Balance b/d 30,639
10 Cheque No: 8534 3,240 220,239
14 Cheque No: 8535 156,090 64,149
26 Cheque No: 8536 1,530 62,619 Required:
28 Credit transfer 1,020 63,639
(a) Update the Cash Book for the month of September 2017.
29 Interest charges 120 63,759
30 Service charges 150 63,609 (b) Reconcile the difference between the updated Cash Book and the balance in
Credit transfer 3,900 67,509 the Bank Statement as at 30 September 2017.