Unit – 9 : Bank Reconciliation statement Bank Reconciliation statement
- Bank reconciliation( B. R. ) is based on the principle of double entry.
- Credit the giver and debit the receiver
- B. R. Shows causes of differences between cash book and pass book balance
- Debit balance as per cash book is credit balance as per pass book = positive balance
- Credit balance in cash book is debit balance in pass book = negative balance/overdraft
Causes of differences
- Cheque issued but not presented for payment
- Cheque deposited but not yet realized
- Bank charges
- Interest on saving bank
- Int. on overdraft
- Amount directly collected by bank
- Amount directly paid by bank on Std. Instructions
- Dishonor of a Cheque
- Direct payment into bank by customer
- errors