At the end of July 2019 the cashbook summary shows a balance of $28,000. Subsequently, the following discoveries were made:

1. Cheque issued to Mr. Cooper, a supplier, for $4,000 was presented for payment after July 31, 2019.

2. The following cheques were issued by the business for $3,000, $4,000 and $7,000 respective however; the cheque for $4,000 was not presented to the bank until August 3, 2019.

3. A cheques of $3,000 was issued to RTBC Ltd. but was not recorded in the cash book.

4. A cheque for $1,000 was deposited on the 31^st of July but was not credited to the bank statement until after July 31.

5. Four cheques were deposited for $10,400, $4,000, $2,000 and $6,400 respectively but the cheque for $6,400 was credited in the bank statement on August 2, 2019.

6. Received a cheque for $4,000, however, it wasn’t recorded in the cash book

7. The Bank credited the bank statement on July 20 for interest $ 600 and on July 25^th debited the bank statement for interest $ 200. These transactions have not been recorded in the cash book

8. Bank charges $ 20 for new Cheque book issuance was entered twice in the cash book.

9. Dishonored Cheque for $4,000 was not adjusted for in the cash book

10. Cheque for payment to Mach’s Catering for $5,000 was mistakenly entered on the debit side of the cashbook as $50.

11. The balance in the cash book should have been $30,000 and not $28,000

12. A standing order payment of $1,600 to NHT has been recorded in the bank statement but is not mentioned in the cash book.

You are required to

a. Prepare the adjusted cash book 

b. Prepare the bank reconciliation statement for July 31, 2019

c. What is the purpose of the bank reconciliation statement?

Answer rating: 100% (QA)

a Total 39570 Total 39570 Cash book Particular Amount Particular Amount To balance betweend 28000 By ... View the full answer