Consortium Commercial Bank

DR CR Balance

$mn $mn $mn

July 1 8.00

July 6 5.00 3.00

July 7 0.20 2.80

July 8 1.80 1.00

July 8 25.00 26.00

July 9 6.00 32.00

July 10 2.00 30.00

July 15 19.00 49.00

July 16 1.70 47.30

July 23 1.30 46.00

July 30 7.00 39.00

July 31 1.00 38.00

The sum debited on the bank statement of Polly Vaughn on July 30, represents an amount for charitable subscriptions.

The sum debited on the bank statement of the company on July 31 represents bank charges for the month of July.

Required:

1. Prepare an updated bank account for Polly at July 31, 2012.
2. Prepare the Bank Reconciliation Statement for Polly at July 31, 2012.
3. What are some of the reasons for the differences between the cash book and the bank statement balances at the end of the month?

Bank Reconciliation Statement The cash book of Polly Vaughn for the month of July is given below: 2012 $mn 2012 $mn July 1 Bal b/d 8.00 July 6 Salaries a/c 5.00 July 8 Sales a/c 25.00 July 7 Repairs a/c 0.20 July 9 Rental Income a/c 6.00 July 8 Insurance a/c 1.80 July 15 Sales a/c 19.00 July 10 Wages a/c 2.00 July 22 Sales a/c 14.00 July 16 Audit fees a/c 1.70 July 29 Sales a/c 65.00 July 23 Legal fees a/c 1.30 July 30 Dividend Income a/c 30.00 July 31 Wages a/c 6.00 July 31 Sales a/c 9.00 July 31 Bal c/d 158.00 176.00 176.00 August 1 Balb/d 158.00