The cash book shows a favourable bank balance of Rs. 31,500. Bank charges of Rs. 1,200 and a direct credit of Rs. 4,000 are not yet recorded in the cash book. Unpresented cheques are Rs. 6,500 and deposits in transit are Rs. 3,000. What balance should appear on the bank statement?
Correct answer: D. Rs. 30,800 favourable
- A. Rs. 27,800 favourable
- B. Rs. 37,300 favourable
- C. Rs. 32,800 favourable
- D. Rs. 30,800 favourable
Explanation
The adjusted cash book balance is Rs. 34,300 after adding the direct credit and deducting bank charges. The bank statement balance is Rs. 34,300 minus unpresented cheques of Rs. 6,500 plus deposits in transit of Rs. 3,000, giving Rs. 30,800 favourable.
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About Bank Reconciliation and Control Accounts
Bank reconciliation explains differences between the cash book and bank statement through unpresented cheques, outstanding deposits, bank charges, direct payments, credited amounts and recording errors. Control accounts summarise receivables and payables ledgers, and their balances are reconciled with individual accounts to locate discrepancies.
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34 free Bank Reconciliation and Control Accounts MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
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