2. Financial Accounting 1 Lecture – 22 Reasons for Difference Between Bank Book and Bank Statement Receipts are recorded by us on the date of receipt of cheque, whereas bank records the transaction at actual time of receipt. Payments are recorded at the time of issuing the cheque, whereas the bank records the payment at time of actual payment. Bank charges deducted by bank that come to our knowledge when we receive the bank statement. Payments made directly by the bank on our standing instructions. Moneys paid in directly by our dealers or custonmers.

3. Financial Accounting 2 Lecture – 22 Example Bank Book (Bank Account Number) Date 20-- Vr. # Chq. No. Narration / Particulars Ledger Code Receipt Amount Payment Amount Balance Dr/(Cr) Jul 01Opening Balance150,000 Jul 050001Paid to XYZ20,000130,000 Jul 10Cash Deposit in Bank5,000135,000 Jul 150002Paid to ABC25,000110,000 Jul 200003Paid to creditors50,00060,000

4. Financial Accounting 3 Lecture – 22 Tracing Figures From Bank Book to Bank Statement Bank Statement Account No. ------- Date 20-- Narration / Particulars Withdrawals Amount Deposits Amount Balance Jul 01Opening Balance150,000 Jul 05Chq # 000120,000130,000 Jul 10Cash Deposit in Bank5,000135,000 Jul 15Chq # 000125,000110,000 Jul 20Chq # 000150,00060,000 Jul 31Bank charges50059,500 Jul 31Profit70060,200

5. Financial Accounting 4 Lecture – 22 Example Bank Statement Account No. ------- Date 20-- Narration / Particulars Withdrawals Amount Deposits Amount Balance Jul 01Opening Balance150,000 Jul 05Chq # 000120,000130,000 Jul 10Cash Deposit in Bank5,000135,000 Jul 15Chq # 000125,000110,000 Jul 20Chq # 000150,00060,000 Jul 31Bank charges50059,500 Jul 31Profit70060,200 NOTE this slide the same as the previous slide with the change of colours

6. Financial Accounting 5 Lecture – 22 Bank Reconciliation Rs. Balance as per bank book60,000 Add: Profit given by bank 700 Less:Charges by bank (500) Balance as per bank statement60,200

7. Financial Accounting 6 Lecture – 22 A payment of Rs. 10,000 is made on 31 Jul, and it appears in our bank statement on Aug, 02. Now the balance as per our bank book is Rs 50,000, and our bank statement is still showing Rs. 60,200

8. Financial Accounting 7 Lecture – 22 Example Bank Book (Bank Account Number) Date 20-- Vr. # Chq. No. Narration / Particulars Ledger Code Receipt Amount Payment Amount Balance Dr/(Cr) Jul 01Opening Balance150,000 Jul 050001Paid to XYZ20,000130,000 Jul 10Cash Deposit in Bank5,000135,000 Jul 150002Paid to ABC25,000110,000 Jul 200003Paid to creditors50,00060,000 Jul 300004Payment10,00050,000 NOTE this slide the same as #2 the change of last row

9. Financial Accounting 8 Lecture – 22 Bank Reconciliation Rs. Balance as per bank book50,000 Add: Profit given by bank 700 Less:Charges by bank (500) Add:Cheque issued but not presentedin bank10,000 Balance as per bank statement60,200

10. Financial Accounting 9 Lecture – 22 Presentation in Balance Sheet Bank book balance is shown in the balance sheet, not the bank statement balance.

11. Financial Accounting 10 Lecture – 22 In the same example assume a cheque of Rs. 10,000 is received on 31 Jul, and it appears in our bank statement on Aug, 02. Now the balance as per our bank book is Rs 70,000, and our bank statement is still showing Rs. 60,200

12. Financial Accounting 11 Lecture – 22 Example Bank Book (Bank Account Number) Date 20-- Vr. # Chq. No. Narration / Particulars Ledger Code Receipt Amount Payment Amount Balance Dr/(Cr) Jul 01Opening Balance150,000 Jul 050001Paid to XYZ20,000130,000 Jul 10Cash Deposit in Bank5,000135,000 Jul 150002Paid to ABC25,000110,000 Jul 200003Paid to creditors50,00060,000 Jul 30Receiupt10,00070,000 NOTE this slide the same as #2 the change of last row

13. Financial Accounting 12 Lecture – 22 Bank Reconciliation Rs. Balance as per bank book70,000 Add: Profit given by bank 700 Less:Charges by bank (500) Less:Cheque received but not credited in bank (10,000) Balance as per bank statement60,200

14. Financial Accounting 13 Lecture – 22 Example Bank Book (Bank Account Number) Date 20-- Vr. # Chq. No. Narration / Particulars Ledger Code Receipt Amount Payment Amount Balance Dr/(Cr) Dec 01Opening Balance174,000 Dec 07Received form Anwer8,800182,800 Dec 0857000Paid to Tariq34,900147,900 Dec 1557001Paid to Shabbir3,300144,600 Dec 22Received from Javed7,300151,900 Dec 2857002Paid to Salim11,500140,400 Dec 31Received from Javed24,900165,300 Dec 31Received form Rashid17,800183,100

15. Financial Accounting 14 Lecture – 22 Tracing Figures From Bank Book to Bank Statement Bank Statement Account No. ---- Date 20-- Narration / Particulars Withdrawals Amount Deposits Amount Balance Dec 01Balance B/f174,000 Dec 07Deposits8,800182,800 Dec 11Chq # 5700034,900147,900 Dec 20Chq # 570013,300144,600 Dec 22Deposits7,300151,900 Dec 31Charges2,200149,700

16. Financial Accounting 15 Lecture – 22 Example Bank Book (Bank Account Number) Date 20-- Vr. # Chq. No. Narration / Particulars Ledger Code Receipt Amount Payment Amount Balance Dr/(Cr) Dec 01Opening Balance174,000 Dec 07Received form Anwer8,800182,800 Dec 0857000Paid to Tariq34,900147,900 Dec 1557001Paid to Shabbir3,300144,600 Dec 22Received from Javed7,300151,900 Dec 2857002Paid to Salim11,500140,400 Dec 31Received from Javed24,900165,300 Dec 31Received form Rashid17,800183,100

17. Financial Accounting 16 Lecture – 22 Tracing Figures From Bank Book to Bank Statement Bank Statement Account No. ---- Date 20-- Narration / Particulars Withdrawals Amount Deposits Amount Balance Dec 01Balance B/f174,000 Dec 07Deposits8,800182,800 Dec 11Chq # 5700034,900147,900 Dec 20Chq # 570013,300144,600 Dec 22Deposits7,300151,900 Dec 31Charges2,200149,700

18. Financial Accounting 17 Lecture – 22 Example Bank Book (Bank Account Number) Date 20-- Vr. # Chq. No. Narration / Particulars Ledger Code Receipt Amount Payment Amount Balance Dr/(Cr) Dec 01Opening Balance174,000 Dec 07Received form Anwer8,800182,800 Dec 0857000Paid to Tariq34,900147,900 Dec 1557001Paid to Shabbir3,300144,600 Dec 22Received from Javed7,300151,900 Dec 2857002Paid to Salim11,500140,400 Dec 31Received from Javed24,900165,300 Dec 31Received form Rashid17,800183,100 Dec 31Charges2,200180,900

19. Financial Accounting 18 Lecture – 22 Bank Reconciliation Statement Balance as per bank book180,900 Add:Un-presented Cheques 11,500 Less:Un-credited Cheques (24,900) (17,800) Balance as per bank statement 149,700