Question

BANK RECONCILIATION
The following information was extracted from the accounting record of ZONKE TRADING. Required: Prepare the following

4.1. The Cash Receipts Journal and the Cash Payments Journal of Zonke Trading for May 2017. [Details and Bank column only]

4.2. The Bank Account in the General Ledger and balance the account. 4.3. The Bank Reconciliation Statement on 31 May 2017.

Format guide:

Cash Receipts Journal : May	Bank

Cash Payments Journal : May	Bank

BANK

Bank Reconciliation Statement as at 31 May 2017	Debit	Credit

m

5

INFORMATION
1. Previous month’s ( April 2017 ) reconciliation statement :

Details	R
Favourable balance as per bank statement	7 000
Outstanding deposit	4 000
Outstanding cheques : No.105 [ 23 November 2016 )	1 300
No. 305	2 800
No. 309	900
Favourable balance as per bank account	6 000

2. Provisional totals of the cash journals on 31 May 2017 were as follows :

   Cash Receipts Journal R 18 000 Cash Payments Journal R 22 000

3. A comparison of the bank statement received for May 2017 with the previous month’s reconciliationrevealed the following :

   •  Cheque no.305 had been presented at the bank for payment.

   •  The outstanding deposit of R4 000 appeared in the May Bank statement.

   •  Cheque no.105 issued as donation to Imbali Orphanage is now stale.

     The cheque must be cancelled and a new cheque will be issued in June.

4. A comparison with the May bank statement and the cash journals , revealed the following :

m

  

 

 

X Bank deposited R1 500 interest on fixed deposit directly into the current account of the business.
Debtor, S.Simbi’s cheque for R900 was returned by the bank marked “insufficient funds’. Thischeque was received in settlement of an account of R950.

The following cheques issued during May 2017 did not appear in the May bank statement : No.345 for R1 200 issued to Telkom.
 No.349 for R1 900 issued to Macsteel for equipment.

Cheque no. 333 for R680, issued to Amaqhawe Wholesalers, was incorrectly recorded in the Cash Payments Journal as R860.
The following debit entries appeared on the bank statement only :

 Service fees, R155
 Cash deposit fees, R100
 Credit card commission, R125

A deposit of R2 500 made by another client of the bank was entered in error in the bank statement of Zonke Trading.
A deposit of R3 922 made by the business on 30 May 2017 did not appear on the May bank statement.

6

•  A stop order payment of R600 to Inhle Insurers appeared on the bank statement, this was inrespect of the proprietor’s personal insurance.

•  The May bank statement received indicated a credit balance of R5 678.

Answer 1

Balance per Bank statement		5678
Adjustments:
Add: Deposits in transit		3922
Deduct O/s check:
No. 309	-900
No.345	-1200
No.349	-1900	-4000
Deduct: Bank error(dep.of another a/c)		-2500
Add: Stop order pmt.issued by Co.		600
Adjusted balance per bank		3700

Balance per Bank statement		5678
Adjustments:
Add: Deposits in transit		3922
Less: O/s check:
No. 309	-900
No.345	-1200
No.349	-1900	-4000
Less: Bank error(dep.of another a/c)		-2500
Add: Stop order pmt.issued by Co.		600
Adjusted balance per bank		3700
Balance per Co. Bank a/c (6000+18000-22000)		2000
Adjustments:
Less:Bank charges for :
Service fees	155
Cash deposit fees	100
Credit card commission	125	-380
Less: NSF check		-900
Add:Interest on FD		1500
Add: Excess debit error Ch.no.333(860-680)		180
Add:Stale ch. 105		1300
Adjusted balance as per bank a/c		3700