ch-10

Question 1

State the need and importance of BRS

Answer 1

1. Brings out the errors ,if any
2. Undue delay in the clearance of cheques deposited is known from the reconcilation
3. Regular reconciliation discourages embezzlements
4. Helps in verifying the accuracy of entries recorded in the cash book
5. Shows actual bank balance

Question 2

Define BRS

Answer 2

It is a statement prepared on a particular day to reconcile the bank balance as per cash book with the balance as per pass book showing entries causing difference between the 2 balances

Question 3

Define Bank pass book/Bank statement

Answer 3

Bank pass book is the copy of account of the account holder in the books of the bank

Question 4

Define favourable/ Debit balance as per cash book

Answer 4

It means surplus amount lying deposited with the bank.

It is the difference between debit side and credit side of the bank column of the cash book, debit side being bigger

Question 5

Define Favourable /Credit balance as per passbook/Bank statement

Answer 5

It means surplus amount lying deposited with the bank.

It is the difference between credit side and debit side of the bank pass book, credit side being bigger

Question 6

Define Unfavourable/ Credit balance as per cash book

Answer 6

It means amount overdrawn. It is the difference between credit side and debit side of the bank column of the cash book, credit side being bigger

Question 7

Define Unfavourable/ Debit balance as per pass book/Bank statement

Answer 7

It means amount overdrawn. It is the difference between debit side and credit side of the bank pass book, debit side being bigger

Question 8

Define overdraft

Answer 8

A situation when the account holder withdraws more money from the bank than is available in his/her account

Question 9

Define corrected/ Amended cash book

Answer 9

As a result of bank reconciliation, entries may have to be passed in the cash book. The cash book, after recording such entries is known as CORRECTED or AMENDED CASH BOOK