Reconciling a Bank Statement

Slides:



Advertisements
Similar presentations
Reconciling the trust to the bank account By-Law 9 SS 18(8) requires that you reconcile the two records by the 25th of each month relating to all trust.
Advertisements

Checks & Payment Methods Ch PoB The First Deposit Starts with providing personal data and a sample of your signature Signature Card – document.
Managing Your Checking Account and Other Financial Services
Cash Control and Banking Activities
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.Glencoe Accounting Internal controls are steps taken to protect assets and keep reliable.
Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.Glencoe Accounting Internal controls are steps taken to protect assets and keep reliable.
CHAPTER TWENTY FOUR BANKING PROCEDURES McGraw-Hill/Irwin Accounting Fundamentals, 7/e © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
Bank Reconciliation. What is bank reconciliation? A process that allows individuals to compare their personal bank account records to the bank's records.
Bank Reconciliation Objective 4.02D Students will understand and complete the bank reconciliation process.
Unit 3: Financial Institutions & Banking Systems
Common payment services What are the common payment services provided by financial institutions? 1.
© 2014 Cengage Learning. All Rights Reserved. Do Now ●If you have a checking account, do you keep records in your checkbook, or do you rely on online banking?
Checks & Payment Methods CHAPTER 17, SECTION 3. The following are some of the benefits that checking accounts provide for consumers. Convenience and ease.
LESSON 5-1 Checking Accounts
Checking Accounts Chapter 29.
Chapter 7 Banking Services. How Banks Work 7.1 The Role of Banks Types of Money.
Cash Control and Banking Activities
Checks, Deposits, Registers, and Reconciliations.
LESSON 5-2 Bank Reconciliation
CHAPTER 6 – CASH CONTROL SYSTEMS
Assume the Position.
Bank Account Reconciliation. Reconciling The process of matching your checkbook register with the bank statement is known as reconciliation. The back.
Cash Control and Banking Activities Making Accounting Relevant Businesses deposit all cash and checks into a bank account and make payments using checks.
Bank Reconciliation Section 7.4. Reconciling your account Banks send statements monthly Banks send statements monthly Cancelled checks may accompany statement.
Check Register Reconciliation
Ms. Smith. 1. Choose a bank. 2. Pick the product you want (individual or joint). 3. Provide your information. 4. Agree to terms. 5. Congratulate yourself!
How Businesses Use Cash Chapter 6 Cash Control Systems.
The Bank Statement A Bank Statement is an itemized record of all the transactions in a depositor’s account over a given period of time, usually one month.
0 Glencoe Accounting Unit 2 Chapter 11 Copyright © by The McGraw-Hill Companies, Inc. All rights reserved. Protecting Cash In any business, cash is used.
Personal Finance 101. Your most recent bank statement and/or cancelled checks A checkbook balancing form Your checkbook register A calculator and pencil.
Banking Services 7.3 Reconcile your checkbook. 7.3 Balance your checkbook Goals: ◦Identify information that is provided on a checking account statement.
GOALS BUSINESS MATH© Thomson/South-WesternLesson 3.4Slide 1 3.4Check Register Reconciliation Reconcile a bank statement Reconcile and correct a check register.
PRODUCTS OF BANKING. Endorsements Before you cash, deposit, or transfer a check to someone else, you must first endorse the check. Endorse: to sign your.
Banking Services 7.3 Balance your checkbook. Goals: ◦Identify information that is provided on a checking account statement. ◦Explain how to reconcile.
Reconcile a Bank Statement UNIT 1 LESSON 2. First… some definitions  Bank statement  Shows all transactions that have occurred during the month  Statement.
9.3 Accounting Controls for Cash Bank Reconciliation Both the bank & the business keep a record of cash for the business but at the end of the month the.
Cash Control Systems Chapter Five. Terms Code of conduct Checking account Endorsement Blank endorsement Special endorsement Restrictive endorsement Postdated.
Section 2Reconciling the Bank Account What You’ll Learn  Why a business reconciles a bank statement.  How to journalize and post entries relating to.
Cash controls and banking activities
Prepared by Johnny Howard © 2015 South-Western, a part of Cengage Learning.
Home. Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.Glencoe Accounting Internal controls are steps taken to protect assets and keep.
Bank Reconciliation Objective 4.02D Students will understand and complete the bank reconciliation process.
GLENCOE / McGraw-Hill. Cash Receipts, Cash Payments, and Banking Procedures.
Prepared by Johnny Howard © 2015 South-Western, a part of Cengage Learning.
Unit 1 - Introduction to Financial Accounting Bank Reconciliation Statements Mr. BarryA-level Accounting Year 12.
© Thomson/South-Western ECONOMIC EDUCATION FOR CONSUMERS Slide 1 Chapter 7 LESSON 7.4 Balance Your Checkbook Objectives: By the end of class, students.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 5-2 Bank Reconciliation.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Chapter 5--Cash Control Systems Objectives: Define accounting terms related to using a checking.
Checks, Deposits, Registers, and Reconciliations.
More about checking … Completing the checking packet.
Banking Procedures Chapter 11, Section 1. Internal Controls steps business itself takes to protect cash and other assets ► Limit people who have access.
Internal controls are steps taken to protect assets and keep reliable records. The bank reconciliation is an important internal control. Glencoe Accounting.
Two ways to protect cash:
Summary of Bank Reconciling Items
© 2014 Cengage Learning. All Rights Reserved.
Bank Account Reconciliation
© 2014 Cengage Learning. All Rights Reserved.
Tracking, Balancing, Reconciling
Welcome Back Glencoe Accounting.
© 2014 Cengage Learning. All Rights Reserved.
DO NOT WRITE BELOW THIS LINE
LESSON 5-2 Bank Reconciliation
LESSON 5-2 Bank Reconciliation
Chapter 6 Cash Control System.
You Better Reconcile.
Ch. 5 Cash Control Systems
17-3 Checks and Payment Methods
© 2014 Cengage Learning. All Rights Reserved.
Accounting 1 Review #2 State Test.
© 2014 Cengage Learning. All Rights Reserved.
Presentation transcript:

Reconciling a Bank Statement Unit 1.4

Bank Statement Is a report provided by a bank to the depositor showing the condition of the account Shows the following: Balance at beginning of the month Checks paid by the bank Deposits made Service or other charges Balance at end of the month

Examining Your Returned Checks and Deposit Slips Banks will return your: Canceled checks Canceled Check – a check that has been paid by the bank Deposit slips

Comparing Your Records with the Bank’s Record Bank Reconciliation – a statement showing how a check register balance and a bank statement balance are brought into agreement Reasons why bank statements and check registers will differ: May have outstanding checks (a check given to the payee by not yet returned to the bank for payment) Service Charge – a fee charged for checking account services Mailed deposit or made deposit that was not processed by the bank prior to bank statement preparation An error made by you or bank

Steps for Reconciling a Bank Statement Open your Check Register Remove the checks and deposits slips included with the bank statement Remove deposit receipts from Cash or Office Files Staple each deposit receipt with the deposit slip that matches

Steps for Reconciling a Bank Statement On page 1 of the bank statement, find the LAST BALANCE SHOWN On the bank reconciliation form (page 2 of the bank statement), WRITE the last balance amount of the balance shown on bank statement line WRITE the balance from the last check register entry on the balance shown in checkbook line

Steps for Reconciling a Bank Statement Complete the left side of the form Arrange deposit slips in chronological order Compare the amounts on the deposit slips with the record of your deposits on the check register Make a record of deposits that have been cleared Put a C or cleared in the √/C column for amount that agrees with an amount on the deposit slip Keep you check register open

Steps for Reconciling a Bank Statement Complete the left side of the form Turn to bank reconciliation. List any deposits not on statement under add deposits not on statement. Then add the balance shown on bank statement and the add deposits not on statement and record the total on the total line Remove any voided checks from the Cash file Arrange canceled checks in numeric order including any voided checks. Compare the amount on each check with the amount on the check register

Steps for Reconciling a Bank Statement Complete the left side of the form Make a record of checks that have cleared Put a C or cleared in the √/C column for amount that agrees with an amount on the deposit slip Turn back to the bank reconciliation. Complete subtract checks issued but not on statement. List the check number and the amount of any checks on the lines. Add checks together and WRITE total on total line. Determine the correct bank statement balance. Subtract the total of the section titled subtract checks issued but not on statement from the total above to determine the corrected bank statement balance

Steps for Reconciling a Bank Statement Complete the right side of the form Write in balance shown in checkbook On the line after add deposits not already entered in checkbook, list any deposits you have prepared or forgot to write in the check register If all deposits have been entered in the check register, bring down the amount of the balance shown in checkbook line and write in on the total line

Steps for Reconciling a Bank Statement Complete the right side of the form Complete the section subtract service charges and other charges not in checkbook. Total the amounts and write the figure on the total line Determine the corrected checkbook balance. Subtract the total of the section subtract service charges and other charges not in checkbook from the total in above section, or bring down the total if not service charges, etc. Write the amount as corrected bank statement balance

Steps for Reconciling a Bank Statement Compared the corrected bank statement balance on the left side of the form with the corrected checkbook balance on the right side of the form If they match, go to step 8 If they don’t match, double check all math calculations and entries in check register vs. bank statement Record any other charges in check register that appear on bank statement (i.e. service charges, EFT, etc.) and find new balance Place everything back into cash file Return deposit receipts without deposits slips to office file