2020 SACSS 3N POA EOY P2 Q3

2020 SACSS 3N POA EOY P2 Q3

3 Kisha’s Cash at Bank account is as follows:

Cash at bank account

Date

Particulars

Cheque No.

Dr  

Cr

Balance

2020

  

$

$

$

June 1

Balance b/d

   

6 520 Dr

         7

Inventory

5200

 

1 630

4 890 Dr

        11

Sales revenue

 

1 850

 

6 740 Dr

        20

Office Machinery

5201

 

1 024

5 716 Dr

        21

Adawiyah

5202

 

1 510

4 206 Dr

        22

Li Xian

 

800

 

5 006 Dr

        29

Advertising expense

5203

 

1 776

3 230 Dr

 

Interest income

 

190

 

3 420 Dr

        30

Niva Batik

 

160

 

3 580 Dr

Kisha received the bank statement which showed the following transactions for the month of June 2020.

Date

Particulars

Withdrawal

  Deposit

Balance

2020

 

$

$

$

 

June 1

Balance b/d

  

6 520

Cr

         8

Standing Order: Insurance

500

 

6 020

Cr

        12

Cheque deposit

 

1850

7 870

Cr

        13

Cheque no. 5200

1630

 

6 240

Cr

        17

Direct Deposit : Rental income

 

2400

8 640

Cr

        22

Cheque no. 5202

1510

 

7 130

Cr

        23

Cheque deposit

 

800

7 930

Cr

        30

Bank charges

40

 

7 890

Cr

 

Unpaid cheque (deposited on 23 June)

800

 

7 090

Cr

REQUIRED

a. Update the cash at bank account for the month of June 2020.

[6]

b. Prepare the bank reconciliation statement as at 30 June 2020.

[6]

c. Give two reasons why a business does bank reconciliations.

[2]

[TOTAL 14]

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 Bank Reconciliation is done to 

  1.   Locate errors which are cash at bank errors or bank errors
  2.   Deter frauds
  3.   Identify items that caused the differences between the cash at bank  

                      account balance and bank statement balance.

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