CSEET · Fundamentals of Accounting · Bank Reconciliation Statement
The cash book of Sharma Traders shows a bank debit balance of ₹48,000 before adjustment. The bank statement shows a direct credit of ₹6,000 for customer collection, interest on investment of ₹2,000 credited, and insurance premium of ₹3,500 paid under standing instruction, none of which is recorded in the cash book. What is the adjusted cash book balance?
The adjusted cash book balance is ₹52,500. Starting at ₹48,000, add the direct collection of ₹6,000 and interest of ₹2,000, then deduct the insurance premium of ₹3,500 paid by standing instruction, because the bank statement items are unrecorded in the cash book.
- A₹52,500Correct
- B₹56,000
- C₹44,500
- D₹47,500
Explanation
Adjusted balance = 48,000 + 6,000 + 2,000 − 3,500 = ₹52,500. Option ₹56,000 ignores the premium, while ₹44,500 subtracts the receipts and adds nothing wrongly signed. Receipts increase and payments decrease the balance.
Did you get it right without looking?
One question tells you little. A timed set on Bank Reconciliation Statement shows your real accuracy, how long you take and where you lose marks.
More Bank Reconciliation Statement questions
- Which of the following is a timing difference that causes the cash book balance and the pass book balance to differ?
- A bank dishonours a cheque that a firm had deposited and received from a customer, and the firm has not yet been informed. What is the effec…
- While preparing a Bank Reconciliation Statement, which one of the following items requires an entry in the cash book (bank column) to bring …
- A business prepares a Bank Reconciliation Statement (BRS) at the end of each month. Which of the following best describes its main objective…
- Verma Ltd.'s cash book shows a bank balance of ₹25,000 debit. The following are discovered: (i) a cheque of ₹6,000 paid to a supplier was en…
- In a BRS prepared from the cash book balance, a cheque of ₹2,500 received from a customer and deposited was dishonoured, and the bank debite…