CA Foundation · Accounting · Bank Reconciliation Statement
A firm's cash book shows a bank balance of ₹30,000. A cheque of ₹4,000 received from a customer and deposited was dishonoured, and the bank debited the account, but the firm has not recorded it. What is the correct adjusted cash book balance?
The adjusted cash book balance is ₹26,000. When a deposited cheque is dishonoured, the bank reverses the credit, so the firm must credit the bank column in the cash book by ₹4,000 and reinstate the customer as a debtor.
- A₹34,000
- B₹26,000Correct
- C₹30,000
- D₹22,000
Explanation
A dishonoured cheque reduces the bank balance because the earlier deposit is reversed. The cash book must be credited with ₹4,000 and the customer's account debited. Adjusted balance = 30,000 − 4,000 = ₹26,000. Adding it gives ₹34,000, which is a sign error.
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