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CLASS EXERCISES-SESSION-8
(For course instructor Guidance)
Learning Objective:
Preparation of Reconciliation Statement under Direct method and adjusting entries.
Q No.1 Shown below is the information needed to prepare a bank reconciliation statement for D
Bros. on Aug. 31,2002
1.
2.
3.
4.
5.
6.

Cash as per bank statement $ 1489

Cash as per companys records $ 1280
Cheque deposited but not cleared $ 700
Uncleared cheques $ 400
bank statement shows deduction of service charges $ 24
Bank collected note receivable on company behalf $ 100 not recorded in cash
book.
7. Cash receipt of $ 453 deposited in bank not recorded in cash book.
8. Cheques had been issued in Aug. but were not included among the paid
cheques returned by bank $ 780.
Instruction
Prepare Bank Reconciliation Statement on Aug 31, 2002.
Prepare adjusting entry in General Journal.
Q No.2: Shown below is the information needed to prepare a bank reconciliation statement for
Hamid Bros. at Aug 31,2002
Cash as per bank statement $ 671
Cash as per companys records $ 2500
1: Cheque deposited but not cleared $ 700
2: bank statement shows deduction of service charges $ 24
3: Cash receipt of $ 4535 on Aug. 31 were not deposited until Sep.3 by bank.
4: Following Cheques had been issued in Aug. but were not included among the paid
cheques returned by bank
No.
amount
620
$950
642
2000
654
480
Instruction
Prepare Bank Reconciliation Statement at Aug 31, 2002

Q No.3: Shown below is the information needed to prepare a bank reconciliation statement for
Hamid Bros. at Sep 30,2002
Cash as per bank statement Rs.5257
Cash as per companys records Rs.6775
1: Customer directly deposited into bank Rs.600
2: Bank credited interest Rs.250
3: Cash deposited Rs.525 but it was recorded by bank Rs.552
4: Cheque deposited but not cleared Rs.5000
5: bank statement shows deduction of service charges Rs.75
6: A cheque issued for Rs.300 but it was recorded in cash book as Rs.30
7: Following Cheques had been issued in Sep. but were not included among the paid
cheques returned by bank
No.
621
643

amount
$950
2000

Instruction
Prepare Bank Reconciliation Statement at Sep 30, 2002
Q No.4
The Sep 30 balance in the Cash Book is Rs. 33000.
Bank statement showing balance of Rs. 32,200.
Following are the differences between the balances
1: Uncleared cheques Rs. 5000
2: Unpaid cheques Rs. 2000
3: A cheque issued to Mr. Amir for payment of A/c payable was not recorded
in the cash book Rs. 5000
4: A cheque drawn for Rs. 10600 for payment of Rent expense but it was wrongly
recorded by bank as Rs 7000
5: Bank credited firms account by Rs 4000 for interest
6: Bank debited firms account by Rs. 400
Instruction
Prepare Bank Reconciliation Statement at Sep 30, 2002

Q No.5 The Mehfooz company had cash balance of Rs.42,800 on August 31,2002 while the
bank statement showed a credit balance of Rs.39,360 on the same date.
1.
2.
3.
4.
5.
6.
7.

Profit credited by the bank Rs. 750

Direct deposit by a customer Rs. 4,100
Dividend collections by the bank on behalf of Mehfooz company Rs. 1,210
Bank service charges Rs. 160
Dishonored cheque of a customer Rs. 1250
Promissory note paid by the bank on behalf of company Rs.4000
Cheque issued total for Rs.15,000 but only Rs.9000 cheque presented to bank and paid by
bank.
8. Deposit in transit Rs. 8320
9. Pay order prepared for Rs.1500 through cheque number 23654 not recorded by firm
cashier.
10. A cheque for Rs. 360 issued in payment of repair expense was credited by the firms
accountant as for Rs.630
Instruction
Prepare Bank Reconciliation Statement on Aug 31, 2002
Q No.6
On comparison of cash book entries with those of the Bank statement of Masood company on
June 30, 1996, the following differences were found:
Cash book balance (Dr) Rs. 15,000
Bank statement balance (Dr) Rs.20,000
1. A cheque for Rs. 14,500 deposited inot bank was wrongly entered into bank statement as
Rs. 5100
2. Mark up charged by bank Rs. 600
3. Cheque of Baber & Co. for Rs. 3500 has marked Not sufficient fund and returned by
bank.
4. A cheque drawn for purchases of equipment Rs. 4000 but was recorded by company Rs.
2500
5. A customer cheque for Rs. 8600 deposited directly in Bank was by mistake entered into
cash column of cash book.
6. Total uncleared cheque s amounted Rs. 30,000
7. Cheque issued Rs. 10,000 but presented for cash Rs. 5800 into bank.
8. Bank paid a not-interest bearing Note for Maqsood company account Rs. 3000 was not
recorded in cash book
9. A cheque Rs. 2000 drawn by Maqbool company was wrongly debited by bank to
Maqsood company account
10. Dividend collected by bank but was not recorded in cash book Rs. 2200
Instruction
Prepare Bank Reconciliation Statement on Aug 31, 2002

Q No.7
Q A comparison of Cash and Bank records of Khalid revealed the following information on 31st
April, 2003.
1
2
3

Balance as per cash book Rs. 13,579

Balance as per bank statement Rs. 1019
Three cheques amounting Rs. 1300, Rs. 3100 and Rs. 4400 were issued to the suppliers,
only the first cheque of Rs. 1300 presented to the bank for payment.
4 Bank returned a cheque Rs. 5000 marked as NSF
5 The bank statement showed a debit of Rs. 510 and Rs. 150 being Zakat deduction and
charges for collection respectively
6 Collection of dividend by the bank Rs. 600 and note receivable of Rs. 2800 has norecord.
in the cash book
7 A cheque of Rs. 7300 issued to supplier but recorded in cash book Rs. 3700
8 Four cheques sent to bank for collection Rs. 12400 but only one cheque of Rs. 4200 cleared
by bank
9 Bank paid insurance premium as per instruction by firm Rs. 1200 not recorded in cash book
10 Bank paid note payable as per instruction by firm Rs. 3000 not recorded in cash book.
11 Cash deposit into bank Rs. 6000 but recorded in cash book Rs. 600
12 Late deposits of Rs. 7200 on the last day did not appear in the bank statement.
Required: Prepare Bank Reconciliation statement.
Q No.8
Balance as per bank statement Rs. 10162
Balance as per cash book Rs. 12525
A cheque issued for Rs. 1500 but not entered in cash book.
A cheque for Rs. 750 deposited into bank but recorded as Rs. 570 in company records.
Bank deposit for Rs. 1750 not shown in bank statement.
Dividends credited by bank not recorded in cash book Rs. 1250
Bank returned a cheque of Rs. 630 marked NSF
Company issued a cheque of Rs. 1250 but recorded by bank as Rs. 1520
Cheque outstanding total Rs. 357
Required: Prepare Bank Reconciliation statement.
Q No.9 The Mehfooz company had cash balance of Rs.42,800 on August 31,2002 while the
bank statement showed a credit balance of Rs.39,360 on the same date.
11. Profit credited by the bank Rs. 750

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12. Direct deposit by a customer Rs. 4,100
13. Dividend collections by the bank on behalf of Mehfooz company Rs. 1,210
14. Bank service charges Rs. 160
15. Dishonored cheque of a customer Rs. 1250
16. Promissory note paid by the bank on behalf of company Rs.4000
17. Cheque issued total for Rs.15,000 but only Rs.9000 cheque presented to bank and paid by
bank.
18. Deposit in transit Rs. 8320
19. Pay order prepared for Rs.1500 through cheque number 23654 not recorded by firm
cashier.
20. A cheque for Rs. 360 issued in payment of repair expense was credited by the firms
accountant as for Rs.630
Instruction
i. Prepare Bank Reconciliation Statement on Aug 31, 2002
ii. Adjusting entries