3.6 Bank Reconciliation Flashcards
1
Q
What are receipts and payments treated as in the business’s book ? ( 2 )
A
- Receipts on Debit side
- Payments on Credit Side
Bank Account
2
Q
What are receipts and payments treated as in bank ? ( 2 )
A
- Receipts on Credit side
- Payments on Debit side
Bank Statement
3
Q
What are the reasons that the balances of the Bank account are not the same as the bank statement ?
( 3 )
A
- Items recorded in the business Cash Book but not shown on Bank Statement
- Unpresented Cheque
- Uncredited Deposits
- Items recorded in Bank Statement but not recorded in Cash Book
- Credit Transfer
- Direct Debits
- Standing Orders
- Dishonoured Cheque , etc.
- Errors or omissions made by business or / and bank
4
Q
What are the business deposits regarded as by the bank ?
A
- Liabilities
5
Q
What are the accounts open in order to lodge day to day receipts and issue cheques ?
A
- Current Account
6
Q
What are credit transfers?
A
- Deposits made directly into business bank account
7
Q
What are direct debits ?
A
- Instruction to bank to make payments of varying amounts from business bank account
8
Q
What are standing orders ( 2 )
A
- Instruction to bank to make fixed payments at regular intervals
- It was also known as banker’s order
9
Q
Where does the balance of the Bank Overdraft record in the business cash book and at Bank Statement ?
A
- Credit side
- Debit side