Question

Problem 6 (7 marks) In early April 2019, Bunny's Factoring received its monthly bank statement showing a debit balance of $342 at 31 March 2019. On 31 March 2019, $720 cash received from debtors was not yet deposited at the bank. There were two unpresented cheques: Cheque no. 100 for $132, and no. 105 for $110. One dishonoured cheque for $250 from Hamster Ltd was returned by the bank. Cheque no. 110 issued for payment of rent for $400 appeared twice on the bank statement by error. Required (a) Prepare Bunny's Factoring's bank reconciliation statement at 31 March 2019. Clearly indicate whether each item is to be added or subtracted. (7 marks)

Answer 1

solution:

Bunny's Factoring
Bank Reconciliation - March 31
Bank's Cash balance		Company's cash balance
Particulars	Amount	Particulars	Amount
Ending balance as per Bank Statements	$342.00	Ending Balance as per cash books (Bal fig)	$1,470.00
Additions:		Additions:
Outstanding Deposits	$720.00
Bank Error	$400.00
Deductions:		Deductions:
Outstanding Checks ($132 + $110)	$242.00	NSF Cheque	$250.00
Up to date cash balance as per bank	$1,220.00	Up to date cash balance as per books	$1,220.00