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Bank Reconciliation Statement Test - 21

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Bank Reconciliation Statement Test - 21
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  • Question 1
    1 / -0
    Which of the following is/are cause of difference of balance between cash book & the pass book?
    Solution
    A cash book cannot account for bank charges in advance.
    Bank charges depend on several things and hence it first gets reflected in the bank book only after which same shall be taken into consideration while preparing the Bank reconciliation statement.
    However, in case of cheques for payments and cheques deposited for collection are known well in advance due to the validity of the instrument and also the the cashier is aware of happening of the same. 
  • Question 2
    1 / -0
    When balance as per cash book is the starting point, bank charges not recorded in cash book are ________.
    Solution
    Bank charges are those service charges which charged by the bank to the account holder for providing the banking services. The amount of such charges is directly debited to the bank account as per the calculation policy of the bank. Since the amount cannot be ascertained by the account holder, it is not recorded in the records maintained by them. Hence, in the reconciliation statement such amount is subtracted to get the closing balance as per bank pass book. 
  • Question 3
    1 / -0
    When balance as per cash book is the starting point, un-collected cheques are ___________.
    Solution
    Uncollected cheques are those which are yet to be deposited by the account holder in the bank , due to which the cash book balance would be higher than the pass book balance.
    So, while preparing the reconciliation statement if cash book is the starting point, uncollected cheques are to be subtracted. 
  • Question 4
    1 / -0
    When balance as per cash book is the starting point, cheques deposited but dishonoured are ____________ .
    Solution
    When cheque is deposited in the bank, the account holder would debit his bank column of the cash book to increase the bank balance, but when the same cheque gets dishonoured his cash book would show higher  balance than his pass book.
    So, while reconciling the bank balances if balance as per cash book is the starting point, cheques deposited but dishonoured are subtracted.
  • Question 5
    1 / -0
    On $$31$$st December balance as per pass book(Cr.) Rs.$$50,900$$. A comaparison of pass book and cash book revealed the following.
     -Cheque deposited for Rs.$$1,000$$ was not credited in pass book.
     -Out of cheques of Rs.$$10,000$$ issued only cheques amounting to Rs.$$7,500$$ were presented for payments.
    Balance as per cash book will be ___________.
    Solution
    The reconciliation is as follows :
      ParticularsAmount in Rs. 
     Balance as per pass book as on 31 st December (Cr.)$$50900$$ 
     AddCheque deposited but not credited $$1000$$ 
     LessCheque issued but not presented for payment $$2500$$ 
      Balance as per cash book as on 31 st December (Dr.)$$49400$$ 
  • Question 6
    1 / -0
    Bank balance as per cash book (Dr.)Rs.$$24,450$$. A comparison of pass book and cash book revealed the following
     -Bank charges Rs.$$200$$ was not entered in cash books.
     -Cheques amounting to Rs.$$250$$ has been dishonored but nor recorded in cash book.
    Balance as per pass book will be _________________.
    Solution
     Particulars + -
     Balance as per cash book (Dr.)24,450  
     Bank charges not entered in cash book  200
     Cheque Dishonored but not recorded in cash book  250
     Balance as per Pass book (Cr.)/ Favourable balance  24,000
  • Question 7
    1 / -0
    Bank charges amounting to Rs.$$5000$$ was not entered in the cash book. Identify the correct adjustment in cash book .
    Solution
    Bank charges is an expense for the business. It is credited in the cash book when paid as it reduces the balance as per cash book. Thus, bank charges of Rs. 5000 which have not been entered in the cash book will be credited in the cash book.
  • Question 8
    1 / -0
    When balance as per cash book is the starting point, cheques issued but not presented for payments are ____________.
    Solution
    In case of cheques issued but not presented for payment, the entry for the same would be entered in the cash book as soon as the cheques are issued by the account holder as a result the cash book balance would be less than the pass book balance.
    So, while preparing reconciliation statement if balance as per cash book is the starting point , cheques issued but not presented for payments are added .
  • Question 9
    1 / -0
    The cash book of N Ltd. showed debit balance of Rs.$$6,000$$. A comparison of pass book and cash book revealed the following
     -Cheques amounting of Rs.$$250$$ has been dishonoured but not recorded in cash book.
     -Total of credit side bank column in cash book was under cast by Rs.$$475$$
    Balance as per pass book will be ________.
    Solution
     Particulars + -
     Balance as per cash book (Dr.) 6,000 
     Cheque dishonoured but not entered in cash book  250
     Amount by which cash book is undercast  475
     Balance as per pass book  5,275
  • Question 10
    1 / -0
    When drawing up a bank reconciliation statement, if you start with a debit balance as per the pass book, the cheques issued but not presented for payments should be _________.
    Solution
    Cheques issued but not presented for payment are entered in the cash book at the moment the cheques are drawn but would not be reflected in the pass book and so the cash book balance would be higher.
    Therefore, when drawing up a bank reconciliation statement, if you start with a debit balance as per pass book, the cheques issued but not presented for payments should be added to reach the cash book balance
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