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Bank Reconciliation Problem!
Asked May 28, 2010, 02:47 AM
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3 Answers I am doing a Bank Reconciliation and there are bank payments recorded in the Cashbook that never appear in the Bank Statement, they are not outstanding cheques or anything like that, they simply don't appear. How would I deal with these to enable me to balance the bank? Many thanks in advance. |
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| First, you can't "balance the bank." The bank has to balance itself. You are making adjustments on a piece of paper to make sure the two (company and bank) would equal if both sides had everything. Therefore, if something is on the books that is not on the bank statement, you still have to adjust it on the bank side of the reconciliation to make sure the two would match. This does not mean the item is correct or that you don't have to fix something or do something about it. It simply means you are "accounting for" everything that is different between the two. If you subtracted it on the books, the only way you can ever reconcile with the bank is subtracted it as an adjustment on the bank's side as well, even if it doesn't belong. (i.e. Reconcile it first - you can fix things later) What kind of payments do you have that aren't outstanding checks? Do you mean like wire transfers or ACH transfers or things like that? If so, then they can still be considered the same as an outstanding check - you just call it something else. However, electronic stuff like that would go through the bank pretty quickly, unless you maybe did it on the very last day of the month and it wasn't posted by the bank yet. If these are things you think should be on the statement but aren't, you still need to reconcile them as I said above, and then call the bank to find out what's going on. | ||||
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| On December 31, 200x, Brown Company's checkbook showed a $8,195.32 balance. Brown's bank statement showed a balance of $8,400.50. Check #311 for $395.10 and Check #418 for $115.46 were outstanding. A $310.30 deposit was in transit. The Bank charged a $10 service charge. The statement showed a $14.92 earned interest income. Complete Brown's bank reconciliation. | ||||
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