Question 4The following is a summary from the cash book of Lim Enterprise for October 2017. RM RM Opening balance b/f 1,407Payments15,520Receipts 15,073Closing balance c./f960 16,480 16,480 On investigation, you discover that:Bank charges of RM35 shown on the bank statement have not been entered in the cash book.A cheque drawn for RM47 has been entered in error as a receipt.A cheque for RM18 has been returned by the bank marked ‘refer to drawer’, but it has not been written back in the cash book.An error of transposition has occurred in that the opening balance in the cash book should have been carried down as RM1,470.Three cheques paid to suppliers for RM214, RM370 and RM30 have not yet been presented to the bank.The last page of the paying-in-book shows a deposit of RM1,542 which has not yet been credited to the account by the bank.The bank statement shows an overdrawn balance of RM52. You are required to:show the adjustments made in the cash book; andprepare a bank reconciliation statement as at 31 October 2017.

A bank reconciliation statement is the statement in which company matches the balance as per cash…

Answered: Question 4 The following is a summary…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question 4

The following is a summary from the cash book of Lim Enterprise for October 2017.

	RM		RM
Opening balance b/f	1,407	Payments	15,520
Receipts	15,073	Closing balance c./f	960
	16,480		16,480

On investigation, you discover that:

Bank charges of RM35 shown on the bank statement have not been entered in the cash book.
A cheque drawn for RM47 has been entered in error as a receipt.
A cheque for RM18 has been returned by the bank marked ‘refer to drawer’, but it has not been written back in the cash book.
An error of transposition has occurred in that the opening balance in the cash book should have been carried down as RM1,470.
Three cheques paid to suppliers for RM214, RM370 and RM30 have not yet been presented to the bank.
The last page of the paying-in-book shows a deposit of RM1,542 which has not yet been credited to the account by the bank.
The bank statement shows an overdrawn balance of RM52.

You are required to:

show the adjustments made in the cash book; and
prepare a bank reconciliation statement as at 31 October 2017.

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