On 31 October 20-4 David Alexander’s cash book showed a bank balance of

£2,750; on the same date his bank statement showed a balance of £2,290.

The difference between the two balances was found to be due to the following:

(a) On 15 October a payment of £25 for a trade subscription had been made by the bank; this had not been entered in David Alexander’s cash book

(b) A direct debit payment for business insurance of £175 had been made by the bank on 20 October, but no entry had been made in the cash book

(c) Bank charges amounting to £60 had been charged on the bank statement but not yet entered in the cash book

(d) A payment fromW Jones of £462 by giro credit transfer had not been entered in the cash book

(e) Cheques for £238 and £376 drawn by David Alexander had not been presented for payment

(f) A cheque for £442 from KWilliams paid into the bank on 3 October had been returned by the bank marked * refer to drawer^; No entry of this dishonoured cheque had been made in the cash book

(g) On 30 October David Alexander had paid cash and cheques amounting to £834 into the bank, but this item had not yet appeared on the bank statement You are required to:

(a) Make the necessary entries to update the cash book on the 31 October 20-4.

(b) Prepare a bank reconciUation statement as at 31 October 20-4.