Lowak Ltd operates two bank accounts with its banker, account number 1 and account

number 2. as at 31 March 2020, the balances as per the bank statement and the cash book were

as follows:

Account Balance as per bank statement Balance as per cash book

Sh. Sh.

Number 1 323,600(Cr) 34,000(Dr)

Number 2 156,400(Dr) 277,600(Dr)

Investigations revealed the following:

1. Cheques lodged but not yet credited:

Sh.

Account No. 1 80,000

Account No. 2 56,000

2. Cheque No.F301 for Sh. 8,000 deposited into account No. 2 was dishonoured but this has

not been reflected in the cash book.

3. A cheque No. M420 for Sh. 8,800 paid direct into bank account No. 1 has not been recorded

in the cash book.

4. A cheque No. K341 for Sh. 6,400 was deposited into account No. 2 but this was wrongly

recorded in the cash book as Sh. 8,000

5. A cheque No. A210 for Sh. 29,200 paid out from account No. 1 and recorded as such in the

cash book was erroneously paid out of account No. 2 by the bank.

6. A cheque No. B308 for Sh 12,800 paid out from account No. 2 was erroneously entered in

account No. 1 in the cash book.

7. A transfer of Sh. 400,000 from account No. 1 to account No. 2 had been entered in the cash

book but the bank had not been instructed to effect the transfer.

8. A standing order payment of Sh. 4,000 from account No. 2 had not been recorded in the

cash book.

9. A cheque No. B348 for Sh. 8,400 paid from account No. 2 was incorrectly entered in the

cash book as Sh. 4,800.

10. Bank charges not yet entered in the cash book are Sh. 1,200 for account No. 1 and Sh. 1,600

for account No. 2.

11. A cheque of No. D720 for Sh. 80,000 received in respect of account No. 2 and subsequently

credited to account No. 2 by the bank, was incorrectly entered in account No. 1 in the cash

book.

12. A cheque No. H781 for Sh. 7,200 received in respect of account No. 2 was incorrectly

recorded in the cash book as Sh. 6,800.

13. There was an unpresented cheque of Sh. 2,400 in respect of account No. 2.

Required:

(i) Adjusted cash book for each of the two accounts.

(ii) Bank reconciliation statement for each of the two accounts, for the month of March 2020.