Read the following and answer the questions below.

On 31 December 2015 the bank column of C. Tench's cash book showed a debit balance of £1,500.

The monthly bank statement written up to 31 December 2015 showed a credit balance of £2,950.

On checking the cash book with the bank statement it was discovered that the following transactions had not been entered in the cash book:

Dividends of £240 had been paid directly to the bank.

A credit transfer - HM Revenue & Customs VAT refund of £260 - had been collected by the bank. 

Bank charges £30.

A direct debit of £70 for the RAC subscription had been paid by the bank.

A standing order of £200 for C. Tench's loan repayment had been paid by the bank.

Tench's deposit account balance of £1,400 was transferred into his bank current account.

A further check revealed the following items:

Two cheques drawn in favour of T. Cod £250 and F. Haddock £290 had been entered in the cash book but had not been presented for payment.

Cash and cheques amounting to £690 had been paid into the bank on 31 December 2015 but were not credited by the bank until 2 January 2016.

(a) Starting with the debit balance of £1,500, bring the cash book (bank columns) up to date and then balance the bank account.

(b) Prepare a bank reconciliation statement as at 31 December 2015.