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Bank Reconciliation Statement.

सही विकल्प है (a) व्यापारी

सही विकल्प है (क) पत्रक, खाता

सही विकल्प है (ब) व्यापारी

जिन व्यवहारों के कारण रोकड़बही के अनुसार की बैंक शेष और पासबुक के अनुसार की शेष में अंतर आता न हो, उन व्यवहारों को बैंक समाधान विवरण में लिखा नहीं जाता ।

Favourable Balance as per cash book: The Debit Balance of cash is favourable balance of cash book. 

Unfavourable cash book: The Negative Balance of cash is unfavourable cash book.

The printing statement or book which explain the transactions of deposit holder called pass book.

This statement is False. 

Overdraft as per Cash Book means credit balance as per cash book. Cashbook debit means deposits. When cash book debit balance is greater it means Bank Balance as per Cash Book.

This statement is True. 

A businessman maintains a cash book with a bank column to record his bank transactions whereas the bank also maintains a customer’s ledger account and issues him a Bank statement. There could be differences as per the bank balance in the cash book and bank balance in the passbook. To detect the errors that take place in accounting Bank Reconciliation Statement is prepared.

This statement is True. 

The Debit side of the passbook represents payments. So any payments made by the bank, Bank debits the customer’s account and records on the Debit side of the passbook.

This statement is False. 

Bank charges are expenses for the business. Expenses decrease the bank balance as per Pass Book. Bank charges debited by the bank decrease the bank balance as per Pass Book.

This statement is True.

All incomes are shown on the credit side of the passbook. It is a deposit. So Interest Credited in Passbook is an income to the customer.

Correct option is (a) bank overdraft

i. Agree

ii. Agree

iii. Agree

iv. Disagree

v. Disagree

vi. Disagree

vii. Disagree

viii. Agree

ix. Agree

x. Agree

(a) Credit balance as per bank statement

Correct option is (b) bank balance

This statement is False. 

Overdraft facility is allowed only to business current A/c and not to Proprietor’s Personal A/c.

When the cheques are deposited into bank, the amount is debited in the cash book on the same day. But, these may not be shown in the bank pass book on the same day because these will be entered in the bank statement only after the collection of the cheques.

A transaction, because of which the difference arises between the bank balance as per cashbook and balance as per passbook, those transactions are recorded in a bank reconciliation statement.

The causes of difference that occur due to time lag are, 

• When issued cheques are not presented for payment in the period for which Bank Reconciliation Statement is being prepared, i.e., date of issue and the date of presenting the cheques are not same. 

• When deposited cheques are not cleared in the period for which the Bank Reconciliation Statement is being prepared.

Main objective of bank reconciliation statement is to reconcile different between closing balance as per passbook and as per cashbook for respective period.

Correct option is (b) bank balance

Correct option is (b) credit

Bank Reconciliation Statement: Bank balance as shown by the cash book must tally with the balance shown by the passbook. It is quite often seen that the balances as revealed by the cash book and the passbook do not tally. These differences may arise due to numerous reasons. In order to tally the balances of bank column of cash book and the passbook, a statement is prepared (UPBoardSolutions.com) which is known as the ‘Bank Reconciliation Statement’. Thus, Bank Reconciliation Statement may be defined as “The statement which is prepared to find out the reasons of differences in the balances of Cash Book and that of the Pass Book is known as Bank Reconciliation Statement”.

Importance of Bank Reconciliation Statement: 

The various reasons for the preparation of Bank Reconciliation statement are as follows:

1. Cheques Issued but not Presented for Payment: As soon as any person is issued a cheque by the customer of the bank it is recorded on the credit side in the bank column of the cash book. The same cheque is presented by the person after a duration of time. Thus, if in between this duration the balances are reconciled there will be a difference in the two balances.

2. Cheques Deposited but not Collected or Credited by the Bank: As soon as the cheques are deposited in the bank, the customer debits the bank column of the cash book. This will lead to an increase in the balance in the cash book. The bank will not increase the balance unless the amount is really received. The process of collection of cheques takes some time. If during this duration the balances are compared there will be a difference in the two because of these cheques.

3. Bank Charges: The bank provides many services to its customers. It provides services like collection of dividends, collection of interest, etc. The bank charges some extra amount for these services. Thus bank balance is (UPBoardSolutions.com) reduced as this is debited from the customers account without giving an intimation. This reduces the bank balance and no entry is made in the cash book.

4. Direct Deposits by Customers: There may be some customers who may deposit the money directly into the bank. Thus, the bank balance is increased while the balance in the cash book is not adjusted, accordingly this causing a difference in the balance.

5. A collection made by the Bank on Behalf of Customer: The bank may collect dividend on shares, on government securities etc. on behalf of the customer. The bank credits the amount to the passbook. This increases its balance. While the balance of the cash book is undercast. Thus, the two balances will differ from each other.

6. Dishonour of Bill Discounted with the Bank: The customer gets the bill discounted from the bank before the due date but if on the due date it was dishonoured the bank will debit the amount and the passbook balance will be reduced whereas the cash book will remain unchanged. This will also lead to the difference in the balances.

7. Interest Charged and Allowed by the Bank: When there is overdraft, the bank may charge interest on overdraft. The bank, will record it on the debit side of the passbook. There will be no entry in the cash book to this effect unless some information is received by the bank, thus leading to a difference in the balances. The bank allows some interest on the amount deposited by the customer on a specific date but the customer is informed at a later date. The customer will not pass any entry to this effect in the bank column of the cash book. Hence, there will be a difference between the two balances.

The procedure of Preparing a Bank Reconciliation Statement: In order to prepare a Bank Reconciliation Statement, the following steps should be undertaken:

1. Selection of date: Select the date on which the reconciliation statement is to be prepared. It is advisable for the students that the last date of the month should be taken into consideration so that balances as revealed by the Cash Book and the Pass Book may be easily taken out.

2. Scrutinising of entries: The entries on the debit and the credit sides in the Bank column of the Cash Book are checked with the respective credit and debit sides in the statement relating to the period in question. 

3. Grouping of items: The items which are left unticked should be grouped according  to their respective headings.

4. Placing of items: The remaining unticked items should be grouped under two main headings ‘Add’ and ‘Less’. This grouping of items is of course based on a decision whether the student wants to start the reconciliation statement with the Cash Book Balance or the Pass Book Balance. 5. Copying of Statement: The Bank Reconciliation Statement should be copied into the Cash Book at the end of the month or it should be kept safely in a separate record.

Rules to be followed for Bank Reconciliation Statement: If the balance of Cash Book is given in the question and the Pass Book balance is to be scrutinised then the following items will be added:

• Cheques issued but not presented in the bank for payment till the end of the month. 
• Amounts credited by the bank without giving intimation to the customer by the end of the month.

The following items will be subtracted from the given balance:

• Amounts debited by the bank in the account of the customer without giving any information to him by the end of the month.
• Amounts of credit which have been anticipated to be credited but no credit was provided by the bank till the end of the month.

If overdraft (balance) is given then ( – ) sign will be asserted before balancing figures and calculation will be done accordingly. If the balance of Pass Book is given in the problem and balance of Cash Book is asked, 

then Add:

• Amounts debited by the bank in the account of the customer without intimating the customer till the end of the month. 
• Amounts of credit which were expected to be credited but no credit could be given.

Less:

Cheques issued but not presented in the bank for payment till the end of the period in question. 

Amounts credited by the bank without giving intimation to the customer till the end of the month.

Specimen of Bank Reconciliation Statement

i. Debited

ii. Bank

iii. Cash

iv. Bank Reconciliation Statement

v. Increase

This statement is True.

The credit side of the passbook means deposits made in the bank account. When direct deposits are made by debtors into a businessman’s bank account. It increases the bank balance and it is recorded on the credit side of Pass Book.

This statement is False.

The businessman can prepare a Bank Reconciliation statement with the help of a cash book, bank column, and passbook. It is a comparison between the two to correct the differences. Both i.e. cash book and pass book/Bank statement are required to prepare a Bank Reconciliation statement.

This statement is True.

A bank statement is a statement issued by the bank to the current account holder informing about the bank transactions during a particular period of time. Generally, it is issued every i.e. month. It gives details information about bank deposits and withdrawals etc.

This statement is True.

Bank overdraft as per cash book means negative bank balance. The businessman has to pay the Bank. Bank charges are expenses for the business and this increases the amount payable to the bank so bank charges debited in the passbook only are to be added in the cash book.

A Businessman, trader, or accountant prepares Bank Reconciliation Statement at the end of every month.

The debit balance of the cash Book indicates a positive Bank balance as per Cash Book.

A bank statement is sent by the Bank manager to the account holder informing about debit or credit given by the bank.

(a) Pass book 

(b) Pass book favourable 

(c) (1) Timing difference, (2) Errors in recording

An infant pukes on the mother’s arms. As he is unable to articulate his needs, he keeps on crying like a kitten. Then he goes to school giving up his freedom. He is made to learn things he doesn’t want to learn. Then he becomes an adult hopelessly in love. He wastes his purple youth writing love letters or songs admiring the beauty of his love. Some join army or police force to serve the nation. At the peak of adulthood, they are quite touchy about honour and believe it to be more important than life itself.

1. actors 

2. enter

3. dependent 

4. reluctantly 

5. composing 

6. attention 

7. reputation 

8. promises 

9. maturity 

10. serious 

11. treble 

12. faculties

(a) The world is compared to a stage.

(b) ‘Entrances’ means life. ‘Exits means death.

(c) The first stage of human life is “infant”. The babe on nurse’s arms pukes and mewls.

(d) The second stage is school boy. The boy goes to school with a heavy heart like a snail.

(e) As a lover, man sings serenades seeking the attention of his lady love.

(f) In the fourth stage, man becomes aggressive and ambitious and seeks glory in all his pursuits. He is ready to enter the mouth of cannon for a moment of glory.

(g) In the fifth stage, man grows mature and wise. He becomes an impartial judge. He is firm and serious about his opinions.

(h) In the sixth stage, man becomes thin and weak. His fashionable dresses of youthful days have now become too lose to use for his shrunk shank (i.e.) legs that have become very lean with age.

(i) The last stage is called the second childhood. The old man slowly loses all his senses. He requirs the support of a nurse or wife to do anything. In this stage, he departs from the world.

A credit balance of Cash Book indicates overdraft as per Cash Book.

Bank reconciliation statement is a statement prepared for determining causes of differences and. reconciling bank balance (as per the Cash Book) with the balance as per the Pass Book or vice versa. Bank Reconciliation Statement (BRS) is prepared when the bank balance of the Cash Book is not equal to the balance shown by the Pass Book on the same date (when BRS is being prepared). In order to match the two respective balances, errors and omissions are to be located and rectified, which is the main rationale behind preparing the Bank Reconciliation Statement. 

The need for preparation of Bank Reconciliation Statement is: 

• It helps in finding out the errors and omissions committed in the Cash Book and in the Pass Book. 

• It shows uncleared cheques that have already been debited in the Cash Book but have not yet been recorded in the Pass Book. 

• It helps in checking embezzlement of money from the bank account.

• It helps in measuring the accurancy of transactions recorded in the Cash Book. 

• It facilitates in preparing revised cash book that reflects a true bank balance. 

A direct deposit made by a customer is recorded on the credit side of the passbook.

i. Payment/Credit

ii. Debited

iii. Credit

iv. Withdrawal Slip

v. Bank Advice

Interest on investment is to be shown on the debit/receipt side in the Cash Book.

(c) The balance as per the bank column of the cash book and the bank statement

(c) A customer’s account in the bank’s book

This statement is True. 

Monthly preparation of Bank Reconciliation Statement assists in the regular monitoring of cash flows of a business and identification of accounting errors.

The Palayakkarars carried on the following duties:

1. They collected revenue, administered the territory control, settled disputes and maintained law and order. 

2. On many occasions the Palayakkarars helped the Nayak rulers to restore the kingdom to them.

The two prominent blocs were Eastern and Western Palayams:

Eastern Palayams:

1. Sattur 

2. Nagalapuram 

3. Ettayapuram 

4. Panchalamkurichi.

Western Palayams:

1. Uthumalai 

2. Thallawankottai 

3. Naduvakurichi 

4. Singampatti 

5. Seithur.

Correct option is (d) month

Palayakkarars police duties were known as Padikaval.

Correct option is (a) debit

1. Viswanatha Nayaka of Madurai 

2. Sivagiri 

3. Gopala Nayakar 

4. Ramalinganar 

5. Kayathar 

6. Second Palayakarar war 

7. Fateh Hyder (the eldest son of Tipu sultan) 

8. Colonel. Gillespie