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CA Foundation · Accounting · Bank Reconciliation Statement

The unadjusted cash book of Rao & Sons shows a bank balance of ₹40,000 (debit). The pass book shows bank charges of ₹300 and interest on a bank loan of ₹1,200 not yet entered in the cash book, and a customer's direct deposit of ₹4,500 not yet entered. What is the adjusted cash book balance?

The adjusted cash book balance is ₹43,000 (debit). Starting at ₹40,000, the direct deposit of ₹4,500 is added, while bank charges of ₹300 and loan interest of ₹1,200 are deducted, a net increase of ₹3,000.

  1. A₹42,000 (debit)Correct
  2. B₹43,000 (debit)
  3. C₹43,500 (debit)
  4. D₹37,000 (debit)

Explanation

Start with ₹40,000. Add the direct deposit of ₹4,500, giving ₹44,500. Deduct bank charges ₹300 and loan interest ₹1,200, total ₹1,500. The adjusted balance is ₹44,500 - ₹1,500 = ₹43,000. Check: net adjustment is +₹3,000, so ₹40,000 + ₹3,000 = ₹43,000. The correct figure is therefore ₹43,000.

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