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26 October, 08:06

Brangelina Adoption Agency's general ledger shows a cash balance of $4,574. The balance of cash in the March-end bank statement is $7,307. A review of the bank statement reveals the following information: checks outstanding of $2,784, bank service fees of $66, and interest earned of $15. Calculate the exact balance sheet

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  1. 26 October, 11:56
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    Reconciliation of balances

    Balance as per cash records = $4574

    Add: Checks issued but not yet paid i. e outstanding $2784

    Less: Bank service fee $66

    Add: Interest earned $15

    Balance as per Bank Statement $7307

    OR

    Balance as per Bank Statement $7307

    Less: Checks issued but not paid yet $2784

    Add: Bank service fee not charged in gen ledger $66

    Less: Interest earned not accounted in gen ledger $15

    Balance as per ledger $4574

    Discrepancy in ledger accounts balance and bank statements arises on account of various reasons. Many a times, a business issues checks and immediately deducts them from the ledger. But some of the checks may not get encashed by the receiver before the end of the month.

    Also, the bank charges and interest credit by the bank does not get recorded in the ledger.
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