Bank Reconciliation Question:
Explain Bank Reconciliation Statement. Why is it prepared?
Answers:
Answer #1Bank Reconciliation Statement is a statement prepared to reconcile the balances of cash book maintained by the concern and pass book maintained by the bank at periodical intervals. At the end of every month entries in the cash book are compared with the entries in the pass book. The causes of differences in balances of both the books are scrutinized and then reconciliation statement is prepared. This statement is prepared for a special purpose and once in a month. It is prepared with a view to indicate items which cause difference between the balances as per the bank columns of the cash book and the bank pass book at a particular date.
Answer #2BRS is the statement which is prepared for find out the difference between cash book and pass book.It contains four types of sub tables.
1.Cheque is issued but not presented
2.Credit given by bank
3.Cheque deposited but not cleared
4.Debit given by bank.
First two table balances adding with cash book closing balance and last two table balances less from (cash book+Adding value) that balance and finally that value should be equal to bank closing balance.
1.Cheque is issued but not presented
2.Credit given by bank
3.Cheque deposited but not cleared
4.Debit given by bank.
First two table balances adding with cash book closing balance and last two table balances less from (cash book+Adding value) that balance and finally that value should be equal to bank closing balance.
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