Exercise Ten Mr. saparas books showed an overdraft of GHS4, 357.00 on December 2010 as bank balance. You are given the following additional information: 1. 2. 3. 4. The following cheques were paid into the bank but were no credited until January 5, 2011 Cheque number 020159 of 8/12/2010 for GH280.00 Cheque Number AG-132471 of 11/12/2010 for GHS219.00 Cheque number 71620BC of 15/12/2010 for GHS111.00 Bank charges of GHS37.00 On 31st December 2010 had not been reflected in the cash book A cheque for GHS337.00 issued to a customer had been wrongly posted as GHS239.00 in the cash book. The following payments settled by standing order had not been entered in the cash book: Life endowment policy GHS23.00 Mortage bank GHS120.00 Alafara club GHS 49.00 5. A cheque for GHS57.00 received from Sule had been credited tochukwu. 6. It was discovered that the overdraft mentioned above was under cast by GHS25.00 7. Cheque amounting to GHS5, 000.00 issued in December 2010 had not been presented for payment. 8. A dividend of GH120.00 paid directly into the bank had not been entered in the cash book. Required: show the adjustment required in the cash book and prepare a bank reconciliation statement as on 31st December. Exercise Nine A. The following is a summary of a cash book presented to you for the month of December GHS GHS Receipt 1,469.00 balance b/f 761.00 Balance c/d 554.00 payments 1,262.00 2,023.00 2,023.00 On investigation, you discover that: 1. Bank charges of GHS136.00 entered in the bank statement had not been entered in the cash book 2. Cheque drawn amounting to GHS267.00 had not been presented to the bank for payment 3. Cheques received totaling GHS762.00 had been entered in cash book and paid into bank but had not been credited by the bank until January 5. 4. A cheque for GHS22.00 had been entered as a receipt in the cash book instead of payment. 5. A cheque for GHS25.00 had been debited by the bank in error. 6. A cheque received forGHS80.00 had been returned by the bank and marked "No Funds Available". No adjustment had been made in the cash book. 7. All dividends receivable are credited directly to the bank account. During December an amount totaling GHS62.00 were credited by the bank and no entries made in the cash book. 8. 9. A cheque drawn for GHS6.00 had been entered incorrectly as GHS66.00 in the cash book. The balance brought forward in the cash book should have been GHS711.00 10. The bank statement as on 31st December showed an overdraft of GHS1,162.00 Required to a. Show the adjustment required in the cash book. b. Prepare a bank reconciliation statement as on 31st December Exercise Six On 30 June 2011 ABC Ltd's cash book showed that it had an overdraft of GHS6,000 on its current account at the bank. A bank statement as at end of June 2011 showed that ABC was in credit with the bank by GHS1,300. On checking the cash book against the bank statement, you find the following: (a) Cheques drawn, amounting to GHS10,000, had been entered in the cash book, but the payees have not submitted the cheques for clearance. (b) Cheques received, amounting toGHS8,000, had been entered in the cash book, but had not been credited by the bank. (c) On instructions from ABC, the bank had transferred interest received on its deposit account amounting to GHS1,200 to its current account, recording the transfer on 5 July 2011. This amount had, however, been credited in the cash book as on 30 June 2011. (d) Bank charges of GHS700 shown in the bank statement had not been entered in the cash book. (e) The payments side of the cash book had been undercast by GHS200. (f) Dividends received amounting to GHS4,000 had been paid direct to the bank and not entered in the current account in the cash book. (g) An amount of GHS1,000 drawn on deposit account had been shown in the cash book as drawn on current account. (h) A cheque issued to Baba for GHS500 was replaced when it became stale. The re- issue of the cheque was entered again in the cash book, no other entry being made. Both cheques were included in the total of cheques not submitted for clearance by the payees in (a) above. Required. i. Indicate the appropriate adjustments in the cash book. ii. Prepare a statement reconciling the amended balance with that shown in the bank statement. iii. Indicate the bank balance that should be carried in the statement of financial position as at 30th June 2011