QUESTION 1

The cashbook of Barloworld Zambia shows a favorable balance of K 38,560 at 30th June,
2023. After comparing the entries in the cashbook with the entries on the related bank
statement, you find that;
(i) Cheques amounting to K 2,180 entered in the cashbook has been presented for
payment to the bank.
(ii) An amount of K 500 entered on the debit side of the cashbook has not yet been
banked.
(iii) An amount of K 950 has been credited by the bank to the account in error.
(iv) The bank has credited and then debited the bank statement with an amount of K450
being Mrs Clara’s cheques which it forwarded on 1st July,2023 marked insufficient funds
return to drawer.
(v) Interest of K 100 has been charged by the bank but not yet entered in the cashbook.
(vi) A cheque from a customer entered in the cashbook as K 880 had been correctly
entered by the bank as K 1,880.

Required:
[a] Show the additional entries to be made in the cashbook and bring down the corrected
balance.
[b] Assuming the balance as per bank statement was K 41,610. Prepare a bank reconciliation
statement.
 SOLUTIONS
[a] Show the additional entries to be made in the cashbook and bring down the
corrected balance.
ADJUSTED CASH BOOK
DETE DETATAILS F DR CR
K K
TH
30 JUNE Balance B/F 38,560
2023

30, JUNE
Presented cheque 2,180

30, JUNE
Unbanked amount 500

30, JUNE
Bank error correction 950

30, JUNE
Dishonored cheques returned 450

30, JUNE
Bank charges 100

30, JUNE
Undercast 1000

30, JUNE
2023.
BALANCE C/D 36,280
 TOTALS 40,010 40,010

1ST BALANCE B/F

JULY,2023 36,280

[b] Assuming the balance as per bank statement was K 41,610. Prepare a bank
reconciliation statement.

BANK RECONCILIATION STATEMENT

K
Balance as per bank statement 41,610
ADD: presented cheque 2,180
Dishonored cheque 450
Bank charges 100
Adjusted balance per bank statement 44,340
LESS: Undercast (1000)
Adjusted balance as per cash book 36,280