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State the need for the preparation of ba...

State the need for the preparation of bank reconciliation statement?

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Need for Preparation of BRS A Bank Reconciliation Statement is required and is vital owing to the subsequent reasons:

It helps in knowing the particular Bank balance. It helps in discouraging the employees from stealing. Helps in distinctive the rationale for variations within the money Book and also the Pass Book.

It helps in distinctive any undue delay within the clearance of cheques.

Helps in detective work and preventing frauds and errors in recording the Banking transactions.

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What is a bank reconciliation statement ?

What is a Bank Reconciliation Statement?

Knowledge Check

  • A bank reconciliation statement is :

    A
    A part of Cash Book
    B
    A part of Pass Book
    C
    A statement prepared by the bank
    D
    A statement prepared by a customer

  • A bank reconciliation statement is prepared by

    A
    Bank
    B
    Customers of the bank
    C
    Creditors
    D
    Auditor

    • Similar Questions

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    What is Bank Reconciliation Statement ?

    Give one point of importance of bank reconciliation statement.

    In which Column (Plus of Minus) you will write the following while preparing Bank Reconciliation Statement from the Cash Book overdraft balance ? (i) Cheques drawn but not cleared. (ii) Interest on bank overdraft. (iii) Cheques paid into the bank but not collected. (iv) Interset on investments collected by the bank.

    On March 31, 2017 the bank column of the cash book of Agrawal Traders showed a credit balance of 1,18,100 (Overdraft). On examining of the cash book and the bank statement, it was found that 1. Cheques received and recorded in the cash book but not sent to the bank of collection 12,400. 2. Payment received from a customer directly by the bank 27,300 but no entry was made in the cash book. 3. Cheques issued for 1,75,200 not presented for payment. Interest of 8,800 charged by the bank was not entered in the cash book. Prepare bank reconciliation statement.

    On 31st March, 2019, Cash Book of a merchant showed bank overdraft of Rs. 1,72,985. On comparing the Cash Book with Bank Statement, following discrepancies were noted. (i) Cheques issued for Rs. 60,000 were not presented in the bank till 7th April 2019 (ii) Cheques amounting to Rs.75,000 were not presented in the bank but were not collected (iii) A cheque of Rs. 15,000 received from Mahesh Chand and deposited in the bank was dishonoured but the non-payment advice was not received from the bank till 1st April, 2019. (iv) Rs. 1,50,000 being the proceeds of a bill receivable collected appared in the Pass Book but not in the Cash Book , (v) Bank charges Rs. 1,500 and intrest overdraft Rs. 8,500 appeared in the Pass Book but not in the Cash Book (vi) Overdraft b alance as per Cash Book of Rs. 500 pm 28thh Feburay, 2019 was wrongly carried forward as debit balance. The error was noted at the time of preparing the Bank Reconciliation Statement as on 31st March, 2019 Prepare Bank Reconciliation Statement

    On March 31, 2017, Rakesh had on overdraft of 8,000 as shown by his cash book. Cheques amounting to 2,000 had been paid in by him but were not collected by the bank. He issued cheques of 800 which were not presented to the bank for payment. There was a debit in his passbook of 60 for interest and 100 for bank charges. Prepare bank reconciliation statement

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