Solution 8.4


In this question:

Opening balances don’t agree but can be reconciled €383 (opening statement balance) + €864 (2nd Nov lodgement) – €632 (CQ 80264) – €146 (CQ 80263) = €469 (opening cash book balance).  €864, €632 and €146 can be ignored as they related to last months reconciliation.5 items on the bank statement not yet recorded in the cash book2 errors in the cash book to correct5 outstanding cash book items for the reconciliationThe closing balance on the cash book was on the debit side this should be brought down on the credit side when getting the cash book ready for the corrections. 

 

 

DR

Cash Book

CR

 

€

 

€

CT – ABC Ltd

950

Bal b/d

340

 

 

DD – Bord Gais

398

 

 

DD – Ryan Rental

725

 

 

Standing order – 006

465

 

 

Bank charges

43

 

 

Lodgement error

60

Bal c/d

1,090

Error CQ 80270

9

 

2,040

 

2,040

 

 

Bal b/d

1,090

 

 

 

 

 

Note, the closing balance in the corrected cash book represents an overdraft because it is brought down on the credit side.

 

 

Bank reconciliation

€

€

Bank statement closing balance

 

328

Add outstanding lodgements

 

 

   30th Nov

859

 

   30th Nov

95

954

Less un-presented cheques

 

 

   Cheque 80268

1,246

 

   Cheque 80272

266

 

   Cheque 80273

860

(2,372)

 

 

 

Balance per cash book

 

(1,090)