Bank reconciliation
Bank Reconciliation Statement
Calculate the balance as per Cash Book or Bank Statement step by step.
Starting balance
Choose where to start
Favourable means positive bank balance. Overdraft means bank balance is negative.
Adjustments
Add reconciliation items
Result
Balance as per Bank Statement / Pass Book
Final balance
Rs.52,000 favourable
Started from Cash Book and calculated Bank Statement / Pass Book.
Working notes
Step-by-step calculation
| Item | Add/Subtract | Amount | Running balance | Reason |
|---|---|---|---|---|
| Cheque issued but not presented | Add | Rs.10,000 | Rs.60,000 favourable | Cash Book has reduced the bank balance, but the bank has not paid the cheque yet. |
| Cheque deposited but not yet credited | Subtract | Rs.8,000 | Rs.52,000 favourable | Cash Book has increased the bank balance, but the bank has not credited it yet. |
Simple explanation
Why this is the answer
We started with Cash Book Rs.50,000 favourable.
Added items increase the balance in this direction of reconciliation.
Subtracted items reduce the balance in this direction of reconciliation.
Balance as per Bank Statement / Pass Book is Rs.52,000 favourable.
Common mistakes
Check these before final answer
- Do not confuse Cash Book balance with Bank Statement balance.
- Cheques issued but not presented are added when starting from Cash Book.
- Cheques deposited but not credited are subtracted when starting from Cash Book.
- Bank charges reduce bank balance if not recorded in Cash Book.
- Overdraft means negative balance.
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