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Question 1 Tadika FEM had a debit cash book balance of RM5,000 as at 30 June 2016. On receiving the bank statement, the owner, Iftinan
Question 1 Tadika FEM had a debit cash book balance of RM5,000 as at 30 June 2016. On receiving the bank statement, the owner, Iftinan Irfan, discovered the following differences between the cash book (bank columns only) and the bank statement: 1. Cheques, amounting to RM3,000, deposited into the bank had not been recorded in the bank statement. 2. The bank had recorded a credit transfer amounting to RM300 for the business. The business had yet to record this receipt into its cash book. 3. Bank charges amounting to RM50 were shown in the banks statement but this was not yet recorded in the cash book. 4. A cheque, amounting to RM2,000, paid to a supplier of school furniture, had not yet been presented to the bank for clearance. 5. A check amounting to RM300, which was recorded as a receipt in the Cash Book, was returned to the business by the bank, stamped with the words 'insufficient fund'. 6. The bank had paid out a cheque for RM200 for the business as per its standing order. This amount was yet to be recorded in the cash book. 7. The bank had credited the bank statement with a cheque amounting to RM700. This cheque actually belonged to some other business. 8. The business had recorded a cheque received for RM600 as a cheque for RM500. 9. The bank had recorded a cheque paid out for RM300 as a cheque aid out for RM800. 10. The business had recorded a cheque of RM200 that was received as a cheque paid out. Required: a) Draw up a Bank Reconciliation Statement as at 30 June 2016. (10 marks) b) What are the meanings of an: i) unpresented cheque (2 marks) ii) uncredited cheque (2 marks) c) Explain THREE (3) causes that lead to differences between the records kept by a business and the records kept by the bank in the context of bank reconciliations. (6 marks)
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