1. Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 1 3-2 RECONCILE A BANK STATEMENT Reconcile a checking account with a bank statement by hand and by using a spreadsheet. OBJECTIVES

2. Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 2 account number bank statement statement period starting balance ending balance outstanding deposits outstanding checks balancing reconciling Key Terms

3. Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 3 The next slide has a bank statement and check register for Michael Biak ’ s checking account. What steps are needed to reconcile Michael ’ s bank statement? Example 1

4. Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 4

5. Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 5 Name some reasons why a check may not have cleared during the monthly cycle and appear on the bank statement. CHECK YOUR UNDERSTANDING

6. Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 6 Example 2 Use algebraic formulas and statements to model the check register balancing process.

7. Financial Algebra © 2011 Cengage Learning. All Rights Reserved. Slide 7 Nancy has a balance of $1,078 in her check register. The balance on her bank account statement is $885.84. Not reported on her bank statement are deposits of $575 and $250 and two checks for $195 and $437.84. Is her check register balanced? Explain. CHECK YOUR UNDERSTANDING