Question

QUESTION 2

The bank reconciliation statement on 30 September 2018 included the following:
       Outstanding cheques
Cheques not yet presented for payment No. 148 (Dated 10 November 2017) No. 358 (Dated 10 October 2018)
No. 400 (Dated 15 October 2018)
Debits
R 17.00 R 360.00 R 956.50
Credits
R1 255.00
               The bank statement on 31 October 2018 showed a favourable balance of R25 427.50. The general ledger account on the 1 October 2018 showed a debit balance of R25 249.50.
The comparison of the bank statement of October with the bank reconciliation statement of September and the cash journals of October showed the following differences:
1. Entries credited on the bank statement which do not appear in the cash journal for October 2018:
• Deposit R1 255
• Direct deposit R480 by Mr. King.
2. Entries debited on the bank statement which do not appear in the cash journal for October 2018:
• Debit order, R325. It is in favour of Knight Rental for rent.
• Cheque no 358, R360.
• Unpaid cheque, R582.50. This cheque was received from Ms. Queen but the cheque
was returned on 27 October 2018 marked insufficient funds.
• Unpaid cheque, R234.50. This cheque was received from Mr. Jack, deposited on 27
October, and returned on 28 October due to irregular signature.

• Unpaid cheque, R247.50. This cheque was received from Ms. Ace and deposited. It was returned by the bank since it was dated 1 November 2018.
• Cheque no. 223 issued to Mr. Ace for inventory, R1 285, was accidentally entered in the CPJ as R1 375.
• Charges for services fees, R30.50, and cash handling fees, R18.
3. Entries in the cash journal that do not appear on the bank statement:
• Cheque no 229 for R1 150 to Castle Wholesalers dated 15 October 2018.
• Cheque no 243 for R112.50 to Z Zeven dated 1 October 2018.
• Deposited on 1 October 2018, R2 445.
4. Cheque no 48 has not been re-issued to date.
You are required to:
a) Prepare the bank account in the general ledger for the month of October 2018.
b) Prepare the bank reconciliation statement as at 30 October 2018.

Please answer a and b.

Answer 1

Bank A/c in General Ledger
Balnce 1 October 2018	R25,250
Cash Deposited in Bank	R1,255
King - Directly Deposited	R480
Rent -Debit Order		R325
Cheque 223 Difference Recorded	R90
Service Charges		R31
Cash Handling Charges		R18
Balnce 31 October 2018		R26,701
	R27,075	R27,075
BANK RECONCILIATION STATEMENT AS ON 31ST OCTOBER 2018
Balnce 31 October 2018 (GL)		R26,701
Add: Cheques issued not yet presented
• Cheque no 229 for R1 150 to Castle Wholesalers dated 15 October 2018.	R1,150
• Cheque no 243 for R112.50 to Z Zeven dated 1 October 2018.	R113
.Cheque no 148	R17
.Cheque no 400	R957	R2,236
Total		R28,937
Less: Cheque deposited Dishonored
Cash not credited in bank	R2,445
• Unpaid cheque, R582.50. This cheque was received from Ms. Queen but the cheque	R583
• Unpaid cheque, R234.50. This cheque was received from Mr. Jack, deposited on 27	R235
• Unpaid cheque, R247.50. This cheque was received from Ms. Ace and deposited. It was returned by the bank since it was dated 1 November 2018.	R248	R3,510
Balance as per Bank statement	Oct31,2018	R25,428
RECONCILIATION FROM 1ST OCTOBER 2018 GL BALANCE
Balance as per General ledger	1 Oct, 2018	R25,250	Dr
Add
Credited on the bank statement not in cash journal	R1,255
Direct deposit by King into Bank	R480
• Cheque no. 223 issued to Mr. Ace for inventory, R1 285, was accidentally entered in the CPJ as R1 375.	R90
in journal not in bank statement:
• Cheque no 229 for R1 150 to Castle Wholesalers dated 15 October 2018.	R1,150
• Cheque no 243 for R112.50 to Z Zeven dated 1 October 2018.	R113
.Cheque no 148	R17
.Cheque no 400	R957	R4,061
	Total	R29,311
Less:
In Bank statement not in GL
• Debit order, R325. It is in favour of Knight Rental for rent.	R325
• Unpaid cheque, R582.50. This cheque was received from Ms. Queen but the cheque	R583
• Unpaid cheque, R234.50. This cheque was received from Mr. Jack, deposited on 27	R235
• Unpaid cheque, R247.50. This cheque was received from Ms. Ace and deposited. It was returned by the bank since it was dated 1 November 2018.	R248
• Charges for services fees, R30.50	R31
• handling fees, R18.	R18
• Deposited on 1 October 2018, R2 445.	R2,445	R3,883
Balance as per Bank		R25,428	Cr