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NCERT Solutions for Class 11 Accountancy Chapter 5 - Bank Reconciliation Statement

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Last updated date: 22nd Mar 2024
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MVSAT 2024

Class 11 Accountancy NCERT Solutions Chapter 5 Bank Reconciliation Statement

Class 11 Accountancy has a vivid syllabus that comprises the important topics of commerce. Chapter 5 precisely covers the concepts and principles related to reconciliation statements. This chapter needs prime attention from the students to prepare. To make the preparation easier, students refer to the NCERT solutions developed by the subject experts of Vedantu. These solutions will speed up their preparation and solve the exercise problems to develop their skills.


Class:

NCERT Solutions for Class 11

Subject:

Class 11 Accountancy

Chapter Name:

Chapter 5 - Bank Reconciliation Statement

Content-Type:

Text, Videos, Images and PDF Format

Academic Year:

2023-24

Medium:

English and Hindi

Available Materials:

  • Chapter Wise

  • Exercise Wise

Other Materials

  • Important Questions

  • Revision Notes



We, at Vedantu, offer Class 11 Accounts Chapter 5 NCERT Solutions free PDF. The chapter summary and exercise questions are presented to the point, enabling students to grasp the concept quickly and precisely. NCERT Accountancy book Class 11 Solutions PDF is also downloadable from the website for future references by the student. We, at Vedantu, provide the student with the best notes available, curated by subject experts with decades of experience in the teaching field. Follow the NCERT Solutions for Class 11 Accountancy Chapter 5 Bank Reconciliation Statement by Vedantu and be prepared for any exam like the toppers.

Access NCERT Solutions for Class 11 Accountancy Chapter 5 – Bank Reconciliation Statement

1. State the need for the preparation of a bank reconciliation statement? 

Ans: The bank reconciliation statement is a document that assists a firm in reconciling the information of transactions performed with its bank account with its financial records. The following are the requirements for preparing the bank reconciliation statement:

  • It aids in determining the accuracy of entries and balances by examining both the passbook and the cashbook at the same time. A bank reconciliation statement is used to verify the accuracy of the balances and entries in the passbook and cash book.

  • It assists in correcting errors and making necessary corrections by comparing the cashbook to the passbook.

  • Certain transactions may slip through the cracks and be unnoticed by the organisation, resulting in unrecorded transactions. As a result, throughout this procedure, companies may be made aware of such transactions.

  • The development of the bank reconciliation statement serves the objective of preventing fraud in bank transactions.

  • The preparation of the bank reconciliation statement is a means for the organisation to learn about unreasonable delays in cheque collections and clearing.

 

2. What is a bank overdraft? 

Ans: The term "bank overdraft" refers to the credit extended by a bank to a business when its balance falls below the bank's minimum balance. As a result, a bank overdraft can be defined as a credit extended over the minimum bank balance for a certain time. Interest is usually charged by banks for such a provision. The benefit of a bank overdraft is that it allows the bank to clear a company check even if there is insufficient money in the account, which would otherwise result in a bounced check.

 

3. Briefly explain the statement ‘wrongly debited by the bank’ with the help of an example. 

Ans: The term "wrongly debited by the bank" refers to the act of a bank debiting a transaction's money in an incorrect manner. An example of this is when a user deposits a cheque for Rs. 10,000 with the bank, but the bank records it as Rs. 1000.

 

4. State the causes of the difference that occurred due to time lag. 

Ans: The following are some of the causes of time lag differences: Because of the temporal lag, there are two sources of the discrepancy.

  • Drawn but un-presented check: In most circumstances, a cheque has a 30-month validity period, and there is a potential that the person to whom the cheque is issued would postpone cashing the check. However, the entry for the same is made in the cashbook, while the record for the same is still missing from the passbook.

  • Cheque placed but not collected: There may be a time discrepancy between when the bank collects the cheque and when the entry for the same is made in the cash book, which records such occurrences instantly. As a result, this could be the cause of the time lag.

 

5. Briefly explain the term ‘favourable balance as per cash book’ 

Ans: Every subsequent receipt is debited, and every payment is debited as well. The positive cash book balance is referred to as the favourable cash book balance. Without adjusting the cash book balance, the balance of the cash book balance is the first item to start with when preparing the bank reconciliation statement. When the bank makes more payments than it receives in receipts, the balance of the passbook is said to be favourable. As a result, the cashbook's favourable balance is the polar opposite of the passbook’s favourable balance.

 

6. Enumerate the steps to ascertain the correct cash book balance. 

Ans: The following are the steps to determine the right balance in the cashbook:

1. Determine the cashbook and passbook balances.

2. Compare the Passbook's debits to the Cashbook's credits, and vice versa.

3. Any errors or discrepancies must be corrected as soon as possible.

4. Add up the cashbook's totals and calculate the balancing number to aid in the preparation of the Bank Reconciliation Statement.

 

7. What is a bank reconciliation statement? Why is it prepared? 

Ans: The bank reconciliation statement is a document that assists a firm in reconciling the information of transactions performed with its bank account with its financial records. The bank reconciliation statement must be kept in order to tally the data in the cashbook and passbook against the figures in the bank account and reconcile the variances between the two.

 

8. Explain the reasons where the balance shown by the bank passbook does not agree with the balance as shown by the bank column of the cash book. 

Ans: The reasons for the balance discrepancy between the bank passbook and the cashbook are as follows:

i. Time lag: There may be a time lag between the duration of time in which the cashbook and the passbook record the entry connected to the encashment of the check - there are two reasons for variations that occur due to time lag.

  • A cheque's validity is limited to 30 months in most situations, and there's a danger that the individual to whom the cheque is issued will be late in cashing it. However, the entry for the same is made in the cashbook, while the record for the same is still missing from the passbook.

  • Cheque placed but not collected: There may be a time discrepancy between when the bank collects the cheque and when the entry for the same is made in the cash book, which records such occurrences instantly. As a result, this could be the cause of the time lag.

ii. Customer direct deposit: In some situations, clients may make a direct deposit of funds without notifying the organisation in advance, and the organisation may be unaware of the transaction until they check their passbook.

iii. Bank Charges and Interest Credits: A bank may deduct charges and credit interest, with notice given only through the bank's statement.

iv. The business's income and expenses are dealt with directly by the bank: The bank offers the option of making direct payments and receiving funds for expenses such as phone and power bills, as well as incomes such as dividends and rents.

v. Dishonoured cheques and bills: In some cases, the organisation may have made an entry for a deposit of a cheque that is later dishonoured, and the organisation does not make an entry for it. Furthermore, banks have the option of discounting invoices, which can result in the bills being dishonoured on the due date. The organisation may not be aware of such transactions until they compare the ledger to the passbook.

vi. Errors and omissions: In some situations, the ban may make omissions, commissions, or errors in transactions conducted via it in order to suit the organization's various needs. There's also the possibility.

9. Explain the process of preparing a bank reconciliation statement with an amended cash balance. 

Ans: Due to a variety of factors, there may be variations between the Cashbook and the Passbook. The steps for determining the accurate cash book balance are as follows:

  1. Determine the cashbook and passbook balances.

  2. Compare the Passbook's debits to the Cashbook's credits, and vice versa.

  3. Any errors or discrepancies must be corrected as soon as possible.

  4. Add up the cashbook's totals and calculate the balancing number to aid in the preparation of the Bank Reconciliation Statement.

The following is the format for a bank reconciliation with an adjusted cash balance:

Particulars 

  Amount

  Amount

Balance as per Cashbook                                                               

Add:

Cheque issued but not presented for

payment                                                                   

Less:

Cheque deposited but not collected 

Bank Charges debited by Bank   

               

Balance as per Passbook      




XXX


XXX

XXX




XXX


XXX



XXX


XXX

 

10. From the following particulars prepare a bank reconciliation statement as of March 31, 2017.

(i) Balance as per cash book Rs 3,200

(ii) Cheque issued but not presented for

payment Rs 1,800

(iii) Cheque deposited but not collected up to

March 31, 2017 Rs 2,000

(iv) Bank charges debited by bank Rs 150

Ans: As of March 31, 2017, the bank reconciliation statement was as follows:

S.No.

Particular

Amount   Rs.(+)

Amount Rs.(-) 



1.

2.

3.

Balance as per the Cash Book 

Cheque issued but not presented for

payment 

 Cheque deposited but not cleared 

 Bank charges

 

Balance as per the Pass Book

3200


1800








2000

150


2850



5000

5000

 

11. On March 31 2014 the cash book showed a balance of Rs. 3,700 as cash at bank, but the bank passbook made up to the same date showed that cheques for Rs. 700, Rs. 300 and Rs. 180 respectively had not presented for payment. Also,

cheque amounting to Rs. 1,200 deposited into the account had not been credited. Prepare a bank reconciliation statement.

Ans: As of March 31, 2017, the bank reconciliation statement was as follows:

S.No.

Particular 

Amount Rs. (+)

Amount Rs.(-)


1.



2.

Balance as per the Cash Book 

Three cheques were issued but not presented for payment 


Cheque deposited but not cleared 

Balance as per the Pass Book

3700


1180





1200


 

12. The cash book shows a bank balance of Rs. 7,800. On comparing the cash book with the passbook the following discrepancies were noted :

(a) Cheque deposited in the bank but not credited Rs. 3,000

(b) Cheque issued but not yet present for payment Rs. 1,500

(c) Insurance premium paid by the bank Rs. 2,000

(d) Bank interest credit by the bank Rs. 400

(e) Bank charges Rs. 100

(d) Directly deposited by a customer Rs. 4,000

Ans: Bank Reconciliation statement

S.No

Particular

Amount Rs. (+)

Amount 

Rs. (-)


a)


b)


c)


d)

e)

f)

Balance as per the Cash Book 

Cheque deposited but not credited in the Pass Book 

Cheque issued but not yet presented for payment 

An insurance premium paid by the bank 


 Bank allowed interest 

Bank debited charges 

Amount directly deposited by the customer 

Balance as per the Pass Book

7800




1500



400



4000



3000



2000



100



8600



1370

1370

 

13. Bank balance of Rs. 40,000 showed by the cash book of Atul on December 31, 2013. It was found that three cheques of Rs. 2,000, Rs. 5,000 and Rs. 8,000 deposited during the month of December were not credited in the passbook till January 02, 2014. Two cheques of Rs. 7,000 and Rs. 8,000 issued on December 28, were not presented for payment till January 03, 2014. In addition to it, the bank had credited Atul for Rs. 325 as interest and had debited him with Rs. 50 as bank charges for which there were no corresponding entries in the cash book.

Ans:  Atul's bank reconciliation statement as of December 31 December 2016

S.No

Particular

Amount 

Rs. (+)

Amount 

Rs. (-) 


1.


2.


3.

4.

Balance as per the Cash Book

Cheques deposited but not cleared in December 

Cheque issued but presented for payment

Bank allowed interest 

Bank debited charges 

Balance as per the Pass Book

40000



15000


325




15000





50

40725



55325

55325

 

14. On comparing the cash book with the passbook of Naman it is found that on March 31, 2014, a bank balance of Rs. 40,960 showed by the cash book differs from the bank balance with regard to the following :

(a) Bank charges Rs 100 on March 31, 2014, are not entered in the cash book.

(b) On March 21, 2014, a debtor paid Rs. 2,000 into the company’s bank in settlement of his account, but no entry was made in the cash book of the company in respect of this.

(c) Cheques totalling Rs. 12,980 were issued by the company and duly recorded in the cash book before March 31, 2014, but had not been presented at the bank for payment until after that date.

(d) A bill for Rs. 6,900 discounted with the bank is entered in the cashbook with recording the discount charge of Rs. 800.

(e) Rs. 3,520 is entered in the cash book as paid into the bank on March 31st, 2014, but not credited by the bank until the following day.

(f) No entry has been made in the cash book to record the dishonour on March 15, 2014, of a cheque for Rs. 650 received from Bhanu.

Prepare a reconciliation statement as of March 31, 2014.

Ans: Bank Reconciliation Statement of Naman as of March 31, 2017

S.No

Particular

Amount Rs. (+)

Amount 

Rs.( -)



a)

b)


c)


d)



e)




f)

Balance as per the Cash Book


Bank debited charges 

Amount directly paid by the debtor into a bank account

 Cheques issued but not presented for payment

Discount charges of the bill were omitted to be recorded in the Cash Book 

Amount debited in the bank column of the Cash Book but not deposited in the bank


Cheque dishonoured not recorded in the Cash Book Balance as per the Pass Book

40960



2000


12980














100





800



3520




650


5870



55940

55940

 

15. Prepare bank reconciliation statement as of December 31, 2017. On this day the passbook of Mr Himanshu showed a balance of Rs 7,000.

(a) Cheques of Rs 1,000 directly deposited by a customer.

(b) The bank has credited Mr Himanshu for Rs 700 as interest.

(c) Cheques for Rs 3,000 were issued during the month of December but these cheques for Rs 1,000 were not presented during the month of December.

Ans: Bank Reconciliation Statement of Mr Himanshu as of December 31, 2017

S.No.

Particular 

Amount Rs.(+)

Amount 

Rs. (-)


a)


b)

c)

Balance as per the Pass Book 

Cheques directly deposited by a customer 

Bank allowed interest 

Cheques issued but not presented for payment in December 


Balance as per the Cash Book

7000









1000


700

1000



4300



7000

7000

 

16. From the following particulars prepare a bank reconciliation statement showing the balance as per cash book on December 31, 2016.

(a) Two cheques of Rs 2,000 and Rs 5,000 were paid into the bank in October 2016 but were not credited by the bank in the month of December.

(b) A cheque of Rs 800 which was received from a customer was entered in the bank column of the cash book in December 2016 but was omitted to be banked in December 2016.

(c) Cheques for Rs 10,000 were issued to a bank in November 2016 but not credited by the bank on December 31, 2016.

(d) Interest on investment Rs 1,000 collected by the bank appeared in the passbook.

Balance as per Passbook was Rs 50,000

Ans:

S.No

Particular

Amount Rs. (+)

Amount Rs.

(-)



a)


b)


c)


d)



Balance as per the Pass Book


Cheques deposited but not cleared till 31 December 7,000

Cheque debited in the Cash Book

but not deposited in the bank 800

Cheque issued but not presented

(not debited in the Pass Book) 10,000

 Interest on investment collected by bank 1,000


Balance as per the Cash Book

50000


7000



800














10000


1000


46800



57800

57800

 

17. Balance as per the passbook of Mr Kumar is 3,000.

(a) Cheque paid into bank but not yet cleared Ram Kumar Rs 1,000, Kishore Kumar Rs 500

(b) Bank Charges Rs 300

(c) Cheque issued but not presented Hameed Rs 2,000, Kapoor Rs 500

(d) Interest entered in the passbook but not entered in the cash book Rs 100

Prepare a bank reconciliation statement.

Ans:

S.No

Particular

Amount Rs. (+ )

Amount Rs.

 (- )


Balance as per Passbook 

Add:

Cheque paid but not

cleared 

Bank Charges 



1000

500

300

30000




1800


Less:

Cheque issued but not

presented 

Interest credited in Bank 


2000

500

100




2600


Balance as per Cash Book


2200

 

18. The passbook of Mr Mohit current account showed a credit balance of Rs 20,000 dated December 31, 2016. Prepare a Bank Reconciliation Statement with the following information.

(i) A cheque of Rs 400 drawn on his saving account has been shown on the current account.

(ii) He issued two cheques of Rs 300 and Rs 500 on December 25, but only the Ist cheque was presented for payment.

(iii) One cheque was issued by Mr Mohit of Rs 500 on December 25, but it was not presented for payment whereas it was recorded twice in the cash book.

Ans: Bank reconciliation statement as on 31.12.2016

S.No

Particular

Amount Rs. (+)

Amount 

Rs. (-)


1.



2.


3.

Balance as per passbook 

Cheque issued from saving account

wrongly debited in the current account of the passbook

Cheque issued but not presented for payment 

Cheque issued but not presented for payment and twice credited in the cash book


Balance as per cash book

20000


400














500





18900



20400

20400

 

19. On 1st January 2017, Rakesh had an overdraft of Rs 8,000 as showed by his cash book. Cheques amounting to Rs 2,000 had been paid in by him but were not collected by the bank by January 01, 2017. He issued cheques of Rs 800

which were not presented to the bank for payment up to that day. There was a debit in his passbook of Rs 60 for interest and Rs 100 for bank charges. Prepare bank reconciliation statement for comparing both the balance.

Ans: Bank Reconciliation Statement of Rakesh as of January 01, 2017

S.No

Particular

Amount Rs. (+)

Amount 

Rs. (-)


1.


2.


3.


4.

Overdraft as per the Cash Book  Cheques deposited but not yet cleared 

Cheques issued but not presented for payment 

 Interest on overdraft debited by the bank 

 Bank debited charges 


Overdraft as per the Pass Book





800





9360

8000

2000





60

100





10610

10610

 

20. Prepare bank reconciliation statement.

(i) Overdraft showed as per cash book on December 31, 2017, Rs 10,000.

(ii) Bank charges for the above period are also debited in the passbook Rs 100.

(iii) Interest on overdraft for six months ending December 31, 2017, Rs 380 debited in the passbook.

(iv) Cheques issued but not encashed prior to December 31, 2017, amounted to Rs 2,150.

(v) Interest on Investment collected by the bank and credited in the passbook Rs 600.

(vi) Cheques paid into bank but not cleared before December 31 2017 were Rs 1,100.

Ans:

S.No

Particular

Amount 

Rs.(+)

Amount 

Rs.(-)


1.

2.

3.


4.



5.

Overdraft as per the Cash Book 

Bank debited charges 

 Interest charged by the bank on overdraft 

Cheques issued but not presented for

payment 

Interest on investment credited in the Pass Book but not entered in the Cash Book

 Cheques deposited but cleared 


Overdraft as per the Pass Book





2150



600



8838

10000

100

380






1100





11580

11580

 

21. Kumar finds that the bank balance shown by his cash book on December 31, 2017, is Rs 90,600 (Credit) but the passbook shows a difference due to the following reason: A cheque (post-dated) for Rs 1,000 has been debited in the

bank column of the cash book but not presented for payment. Also, a cheque for Rs 8,000 drawn in favour of Manohar has not yet been presented for payment. Cheques totalling Rs 1,500 deposited in the bank have not yet been collected and the cheque for Rs 5,000 has been dishonoured.

Ans: Bank Reconciliation Statement of Kumar as of December 31, 2017

S.No

Particular

Amount 

Rs. (+)

Amount 

Rs. (-)


1.


2.


3.

4.

Overdraft as per the Cash Book 

Cheque debited in the Cash Book

but not deposited in the bank 

Cheque issued but not presented for

payment 

 Cheque deposited but not yet cleared 

Cheque dishonoured 


Overdraft as per the Pass Book





8000




90100

90600


1000



1500

5000





98100

98100

 

22. On December 31, 2017, the cash book of Mittal Bros. Showed an overdraft of Rs 6,920. From the following particulars prepare a Bank Reconciliation Statement and ascertain the balance as per the passbook.

(1) Debited by the bank for Rs 200 on account of Interest on overdraft and Rs 50 on account of charges for collecting bills.

(2) Cheques drawn but not encashed before December 31 2017 for Rs 4,000.

(3) The bank has collected interest and has credited Rs 600 in the passbook.

(4) A bill receivable for Rs 700 previously discounted with the bank had been dishonoured and debited in the passbook.

(5) Cheques paid into bank but not collected and credited before December 31, 2017, amounted to Rs 6,000.

Ans: Bank Reconciliation Statement of Mittal Bros. as of December 31, 2017

S.No

Particular

Amount Rs. (+)

Amount Rs. (-)

 

1.

 

 

2.

 

3.

4.

5.

 

 

 

Overdraft as per the Cash Book 6,920

Bank debited interest on overdraft 

Bank debited charges for collecting

bills 

Cheque issued but not presented

for payment 

 Bank collected interest 

Bill Receivable dishonoured 

Cheque deposited but not cleared

in December 

 

Overdraft as per the Pass Book

 

 

 

 

4000

 

600

 

 

 

 

9270

6920

200

 

50

 

 

 

700

 

6000

 

 

 

 

13870

13870

 

23. Prepare bank reconciliation statement of Shri Bhandari as of December 31, 2014

(i) The Payment of a cheque for Rs. 550 was recorded twice in the passbook.

(ii) Withdrawal column of the passbook undercast by Rs. 200

(iii) A Cheque of Rs. 200 has been debited in the bank column of the Cash Book but it was not sent to the bank at all.

(iv) A Cheque of Rs. 300 debited to the Bank column of the passbook was not sent to the bank.

(v) Rs. 500 in respect of dishonoured cheques were entered in the passbook but not in the cash book. Overdraft as per the passbook is Rs. 20,000.

Ans: Bank Reconciliation Statement of Shri Bhandari as of December 31, 2017

S.No 

Particular

Amount 

Rs.(+)

Amount 

Rs .(-)


1.


2.


3.


4.


5.

Overdraft as per the Pass Book 

Payment of cheque twice debited in the Pass Book 

Withdrawal column of the Pass Book

undercast 

Cheque debited in the Cash Book

but not deposited in the bank 

Cheque added in the Cash Book

but not deposited in the bank 

Cheque dishonoured 


Overdraft as per the Cash Book



550




200


300

500


18650

20000




200









20200

20200

 

24. Overdraft shown by the passbook of Mr Murli is Rs. 20,000. Prepare bank reconciliation statement dated December 31, 2014.

(i) Bank charges debited as per passbook Rs. 500.

(ii) Cheques recorded in the cash book but not sent to the bank for collection Rs. 2,500.

(iii) Received a payment directly from customer Rs. 4,600.

(iv) Cheque issued but not presented for payment Rs. 6,980.

(v) Interest credited by the bank Rs. 100.

(vi) LIC paid by bank Rs. 2,500.

(vii) Cheques deposited with the bank but not collected Rs. 3,500.

Ans: Bank reconciliation statement as on 31.03.2017

S.No 

Particular

Amount 

Rs.(+)

Amount

 Rs.(-)



1.


2.


3.

4.


5.

6.


7.

Overdraft as per the Pass Book


Bank charges debited in the Pass

Book 

Cheque recorded in the Cash Book

but not banked 

 Amount directly paid by the customer in 

the bank Cheque was issued but not presented for payment 

 Interest allowed by the bank 

LIC (insurance premium) paid by

bank 

 Cheques deposited but not cleared 


Overdraft as per the Cash Book




500


2500





2500


3500


22680

20000






4600

6980


100








31680

31680

 

25. Raghav & Co. have two bank accounts. Account No. I and Account No. II.From the following particulars relating to Account No. I, find out the balance on that account of December 31, 2014, according to the cash book of the firm.

(i) Cheques paid into bank prior to December 31, 2014, but not credited for Rs. 10,000.

(ii) Transfer of funds from account No. II to account no. I recorded by the bank on December 31, 2014, but entered in the cash book after that date for Rs. 8,000.

(iii) Cheques issued prior to December 31, 2014, but not presented until after that date for Rs. 7,429.

(iv) Bank charges debited by the bank not entered in the cash book for Rs. 200.

(v) Interest Debited by the bank not entered in the cash book Rs. 580.

(vi) Overdraft as per Passbook Rs. 18,990.

Ans: Bank Reconciliation Statement of Account No. I was on 31.03.2017

Bank  Reconciliation Statement of Mr Raghav and Co.

Account No. I as of December 31, 2017

S.No 

Particular 

Amount Rs. (+)

Amount Rs. (-)

 

1.


2.



3.


4.

5.

Overdraft as per the Pass Book

Cheque deposited but not cleared prior to 31 Dec. 2013

Amount transferred Account II to

The account I recorded in the Pass Book

but not entered in the Cash Book

Cheque issued but not presented for

payment 

 Bank debited charges 

Interest on overdraft not credited in the Cash Book 


Overdraft as per the Cash Book



10000






200


580


23639


18990





8000


7429









34419

34419

 

26. Prepare a bank reconciliation statement from the following particulars and show the balance as per the cash book.

(i) Balance as per passbook on December 31, 201 4 overdrawn Rs. 20,000.

(ii) Interest on bank overdraft not entered in the cash book Rs. 2,000.

(iii) Rs. 200 insurance premium paid by the bank has not been entered in the cash book.

(iv) Cheques were drawn in the last week of December 2014, but have not been cleared to date for Rs. 3,000 and Rs. 3,500.

(v) Cheques deposited into the bank on November 2014, but yet to be credited on dated December 31, 2014, Rs. 6,000.

(vii) Wrongly debited by bank Rs. 500.

Ans: Bank Reconciliation Statement as of December 31, 2017

S.No

Particular

Amount 

Rs.(+)

Amount Rs.(-)


1.



2.


3.


4.

5.

Overdraft as per the Pass Book 

Interest on overdraft not credited in the

Cash Book 


An insurance premium paid by

bank not entered in the Cash Book 

Cheques issued but not presented for

payment 

Cheques deposited but not cleared

Amount wrongly debited by the bank 


Overdraft as per the Cash Book


2000




200



6000

500


17800

20000






6500








26500

26500

 

27. The passbook of Mr Randhir showed an overdraft of Rs.

40,950 on March31, 2013. Prepare bank reconciliation statement on March 31, 2013.

(i) Out of cheques amounting to Rs. 8,000 was drawn by Mr Randhir on March 27 a cheque for Rs. 3,000 was encashed on April 2014.

(ii) Credited by the bank with Rs. 3,800 for interest collected by them, but the amount is not entered in the cash book.

(iii) Rs. 10,900 paid in by Mr Randhir in cash and by cheques on March,31 cheques amounting to Rs. 3,800 were collected on April, 07.

(iv) A Cheque of Rs. 780 credit in the passbook on March 28 being dishonoured is debited again in the passbook on April 01, 2014. There was no entry in the cash book about the dishonour of the cheque until April 15.

Ans: Bank Reconciliation Statement of Mr Randhir as of March 31, 2017

S.No

Particular

Amount 

Rs.(+)

Amount 

Rs.(-)


1.


2.


3.


4.

Overdraft as per the Pass Book 

Cheque issued but not presented for

payment in March 

Interest collected by the bank not entered in

the Cash Book 

Cheque deposited but not yet cleared in

March 

Cheque dishonoured in April 


Overdraft as per the Cash Book







3800

780


43170

40950


3000


3800








47750

47750

 

NCERT Accountancy Class 11 Solutions

Quick Recap

From the previous chapters, we are familiar with a few terms like credit, debit, cashbook and passbook, etc. We require some of the concepts previously learned for Class 11 Accountancy Chapter 5 Bank Reconciliation Statement. Here, we present you a quick recap of what those terms stand for.

 

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Individual firms maintain a record of the transactions in a document called cashbook. When a deposit or withdrawal is made by the firm into or from the bank account, the firm records this as an entry in the cash book. An entry is made into the debit side when money is deposited in the account and a credit entry is made when money is withdrawn from the account.

Similar to the cashbook, a record is also made by the bank for these transactions. These entries are made into passbooks. Entries made here work in the reverse fashion of how it is made in the cashbook, i.e. deposits by a customer are marked on the credit side and when a withdrawal is made, it is marked on the debit side of the passbook.

Depending on the amount of money withdrawn and deposited, we may have a favourable or unfavourable balance (overdraft).

 

Why BRS?

For the reasons mentioned above, we match the balances at the end of a particular period of the financial year. It could be on any given day. In the process of balancing the bank balance as per the cashbook and passbook may not match, so another document or statement is created where we account for the ‘missing’ money that has caused the discrepancy. We account for all of those transactions in this statement. At the end of the process, we can account for the balances in the two, and thus, the actual money spent and that on record matches. Thus we can find the actual bank balance.

 

Making of a BRS

While making a BRS, entries in a cashbook and passbook are compared and the item due to which the difference has been caused is analyzed. It is prepared in the following format:


Particulars

Amount

Add

Bank balance as per Cash Book

Cheques issued and not presented

Interest credited by the bank

………………..

………………..

…………………

 

Less

Bank balance as per passbook

Cheques deposited but not credited

Bank balance as per passbook

 

………………..

………………..

………………..

 

 

………………….

……………….

 

Solved Example

Q1. Prepare a Bank Reconciliation Statement from the following particulars as of 15 October 2020 for Mr. Khanna.

  1. Bank balance as per cash book Rs 25000.

  2. Bank charges of Rs 350 were not entered in the cash book.

  3. Cheques issued but not presented for payment of Rs. 12000.

  4. Cheques deposited but not collected by the bank for Rs. 11000.

  5. Dividend collected by the bank and credited to the bank account, not entered in the passbook accounting for Rs 13000

Answer: 

Bank Reconciliation Statement of Mr Khanna as of 15 October 2020:


Particulars

Rs +

Rs -

1

2

3

Balance as per cash book

Cheques issued but not presented for payment

Dividends collected by the bank

25,000

12,000

13,000

 

4

5

6

Cheque deposited but not credited by the bank

Bank charges debited by the bank

Balance as per passbook

 

11,000

     350

38,650

 


50,000

50,000

Importance of Class 11 Accountancy Chapter 5 Bank Reconciliation Statement NCERT Solutions

Class 11 Accountancy is an important subject to study and develops the conceptual foundation of the commerce stream. This subject holds an interesting syllabus that introduces new topics to the students. One such chapter in this syllabus is Reconciliation Statement. This chapter explains the different aspects of bank reconciliation statements that students need to understand and prepare them well.


Studying the concepts of this chapter needs the complete study material and the assistance of the NCERT solutions for all the exercises included in the textbook. This is why the experts of Vedantu have created precise solutions for all the exercise questions in this chapter. Once you are done with your preparation of the theoretical part, you can proceed to solve the exercises and find out how to answer the fundamental questions. Seek guidance from the solutions framed and become better at solving such problems.


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Advantages of Class 11 Accountancy Chapter 5 Bank Reconciliation Statement NCERT Solutions

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Download Class 11 Accountancy Chapter 5 Bank Reconciliation Statement NCERT Solutions PDF

Students  can easily access the Class 11 Accountancy Chapter 5 Bank Reconciliation Statement NCERT Solutions PDF from Vedantu. Vedantu offers a user-friendly platform that provides students with a convenient way to enhance their understanding of this important accounting concept. By downloading the NCERT Solutions PDF, students gain access to comprehensive and well-structured explanations, ensuring clarity on the nuances of bank reconciliation. With Vedantu's resources, students can effectively grasp the intricacies of reconciling bank transactions, identifying discrepancies, and maintaining accurate financial records. This accessible solution not only helps  in exam preparation but also empowers students with practical insights that are applicable to real-world financial scenarios, contributing to their overall academic success.


Conclusion

NCERT Solutions for Class 11 Accountancy Chapter 5 - "Bank Reconciliation Statement" provides a comprehensive understanding of a crucial financial reconciliation process. This chapter elucidates the significance of aligning a company's records with bank statements, minimizing discrepancies, and ensuring financial accuracy. By addressing the complexities of bank transactions, outstanding checks, deposits in transit, and other reconciling items, these solutions equip students with the skills to reconcile accounts effectively. Furthermore, the provided solutions offer invaluable insights into identifying errors, fostering meticulous financial management, and bolstering overall financial transparency. This chapter not only aids exam preparation but also imparts practical knowledge for real-world accounting practices.

FAQs on NCERT Solutions for Class 11 Accountancy Chapter 5 - Bank Reconciliation Statement

1. A mismatch of accounts in the passbook and cashbook can be a result of timing differences. Elaborate.

Suppose a cheque is issued by the firm to a customer. Immediately after issuing a cheque, an entry is made on the debit side of the cash book maintained by the firm. If the customer decides to present the cheque at a later point in time, or if due to some technical inconvenience, the cheque is not cleared on the very same day, the bank is not informed about the issuance. Only after clearing the cheque, an entry is made in the passbooks. This could also happen the other way around. A customer may give a cheque to the bank directly, which is recorded in the passbook immediately. The firm does make this entry until an indication is received. 

2. What are the possible errors while preparing entries in a cash book or passbook?  What is an overdraft?

BRS stands for Bank Reconciliation Statement. As the name suggests, it is a statement and not accounts. It is made to make sure that records from two different places are in agreement. In other words, it ensures that the money spent matches what is in the record. 


Errors: The firm as well as the bank could miss out on a transaction, or make a wrong entry or wrong totalling. Thus, this error could also possibly lead to a mismatch in the accounts. An unfavourable balance or an overdraft occurs when the amount of money credited from a bank account is greater than the amount debited from it. Thus, the bank account becomes negative. While preparing a BRS, it is treated as a negative figure.

3. What is a bank reconciliation statement for Class 11?

When an individual firm or company runs a business they need to keep records for their monetary transactions as well in a cash book and the bank in turn also maintains a record for the same in a passbook. During the end of a financial year when the transactions are tallied there might be discrepancies in these two records, which is then written as another form of statement called the bank reconciliation statement. This has the details for all the missing records of transactions made. To learn more about Class 11 Accountancy Chapter 5 visit Vedantu website and the app.

4. How do I write a bank reconciliation for Class 11?

A bank reconciliation statement is written while the cashbook and passbooks are tallied to see if all the credit and debits made a match with each other so that the balance sheet comes all correct at the end. Whichever transaction goes missing from any one of the records of the bank or the firm is immediately noted down in another record bank in the form of a momentary statement and then at the end, it is added and subtracted accordingly to match with the actual transactions and justify the finance for the year.

5. Why is a bank reconciliation statement needed?

When firms handle a lot of business transactions, there can be faults and disputes which might lead to missing information in the record books. This will create chaos in the end when the firm will fail to match the balance sheets. This is why the bank reconciliation statement is so useful. This statement will help to point out the gaps and calculate them and then finally fill the gaps accordingly. The actual calculations can be found out which is very important for a firm or company in order to keep track of the fluidity of cash. Read more about the chapter on Vedantu website (vedantu.com).

6. What is meant by a bank overdraft Class 11?

There comes situations in a business when the balance of the firm goes below the minimum which means it will fail to carry on with the venture if not provided with enough capital at that time. To solve this problem, the bank automatically transfers cash to the account of the firm so that the venture continues and no transaction is stopped due to the monetary limitation. This is called bank overdraft. This is provided by the bank with some amount of interest to the firm.

7. Where can I find the best possible answers for the Class 5 Chapter 11 Accountancy Subject?

CBSE Class 11 Accountancy Chapter 5 is very well explained in the form of notes, recaps, important questions, solved exercise questions, etc on the web page of Vedantu. Here you will find the best possible answers which will help you to score good marks in your Class 11 Accountancy paper. Apart from that, if you face any difficulty in understanding the concepts of bank reconciliation then you will find easy to comprehend explanations here as well, which is just a click away. You can also download the NCERT Solutions free of cost to study offline.