Question

Bank statement for the month ending 30 April 2020.

Bank statement
Date	Details	Debit	Credit	Balance
01 Apr	Balance			19 200,00 Cr
02 Apr	Cheque No. 674	2 250,00		16 950,00 Cr
	Deposit		4 800,00	21 750,00Cr
03 Apr	Deposit		1 500,00	23 250,00 Cr
05 Apr	Cheque No. 675	1 800,00		21 450,00 Cr
	Bank charges	195,00		21 255,00 Cr
08 Apr	Deposit		9 000,00	30 255,00 Cr
	Cheque No. 678	900,00		29 355,00 Cr
14 Apr	Deposit		3 000,00	32 355,00 Cr
	Deposit		1 200,00	33 555,00 Cr
20 Apr	Cheque No. 679	3 300,00		30 255,00 Cr
23 Apr	Deposit		9 750,00	40 005,00 Cr
	Cheque No. 680	1 650,00		38 355,00 Cr
	R/D cheque	450,00		37 905,00 Cr
25 Apr	Cheque No. 681	2 775,00		35 130,00 Cr
	Debit order – Insurance	75,00		35 055,00 Cr
28 Apr	Cheque No. 682	30 000,00		5 055,00 Cr
	Cheque No. 683	2 250,00		2 805,00 Cr
29 Apr	Cheque No. 239	228,75		2 576,25 Cr
30 Apr	Cheque No. 685	1 650,00		926,25 Cr

ADDITIONAL INFORMATION

1.                  Cheque No. 239 shown on the bank statement was not drawn by Mantal Traders but instead by another client of the bank.

2.                  Cheque No. 685 was incorrectly recorded in the cash payments journal.

3.                  The deposit of R1 200 reflected on the bank statement was made by a debtor N Nets, without notifying the business.

4.                  Cheque No. 500, issued to V Vicks (a creditor) on 01 September 2019, has become stale and must be cancelled. A replacement cheque has not yet been issued.

5.                  The R/D cheque shown on the bank statement was from debtors, T Hamede.

REQUIRED:

a)      Balance as per bank account? ( 10 Marks)

(Example of an answer: 1750; NOT N$1750, NOT N$1750.00 don’t add a comma, space or full stop)

USE TWO DECIMAL PLACES WITH A FULL STOP WHERE APPLICABLE ONLY

Answer 1

ANSWER:

Balance as per Bank Account = 1155

CALCULATION:

	Balance as on 30 Apr	926,25
Add:	Cheque no 239 wrongly debited by bank	228,75
		1155,00

EXPLANATION:

1) Cheque No. 239 shown on the bank statement was not drawn by Mantal Traders but instead by another client of the bank:

It is an incorrect debit by bank so it will be rectified by bank and accordingly amount of the cheque debited on Apr 29, will be credited by bank.

2) Cheque No. 685 was incorrectly recorded in the cash payments journal:

Incorrect recording in cash payment will shrunk cash balance in cash book, but bank has made correct entry of the transaction, so no correction is required regarding this.

3) The deposit of R1 200 reflected on the bank statement was made by a debtor N Nets, without notifying the business:

Deposit without our knowledge is already credited in bank account so no adjustment in bank statement, we require to add the amount in bank column of cash book.

4) Cheque No. 500, issued to V Vicks (a creditor) on 01 September 2019, has become stale and must be cancelled. A replacement cheque has not yet been issued:

Cheque issued to V Vicks is not presented at bank, and becomes stale does not require any adjustment in bank statement. however it would be deducted from bank column in cash book at the time of issuing cheque, so it need to be added back there.

5) The R/D cheque shown on the bank statement was from debtors, T Hamede.:

returned cheque is given effect in bank statement, so we require to enter it in cash payment journal, i.e. deduct from bank column of cash book.

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