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Universal Bhd had a debit balance of RM56,500 in the cashbook on 31 December 2021. The

Bank Statement received for the month showed a credit balance of RM76,710. On comparing

the cashbook with the Bank Statement, the following were discovered:

1. A deposit entry of RM19,500 which appears in the cashbook at 31 December 2021 had

not yet been credited in the bank statement.

2. The bank had collected on the firms behalf a check for RM30,360 being proceeds of a

sale.

3. A check amounting to RM10,500 which was recorded as a receipt in the cashbook was

returned to the firm by the bank, stamped with the word insufficient funds.

4. The last check entered in the cash payment, No 1234, for RM3,630 appears in the bank

statement as RM3,600. An examination of the cashbook reveals that the bank figure is

correct.

5. Check No 1236 for RM3,180 has been correctly debited in the bank statement but not

shown in the cashbook of the firm.CONFIDENTIAL 202204/SEM103/A

Page 3 of 4

6. The checks No1237 RM9,000 and No1238 RM21,000 drawn by the firm have not yet

been presented to the bank.

7. The bank had paid out for RM600 for the firm as per standing order. This amount was

yet to be recorded in the cashbook.

8. Bank charges amounting to RM450 appear on the Bank Statement but not in the firms

records.

9. The firm had recorded a check received for RM780 as a check for RM730. The bank

statement showed a correct amount.

10. A monthly direct debit payable to a leasing company for RM6,000 was wrongly paid

twice by the bank.

Required:

a) Prepare the bank reconciliation at 31 December 2021.

[15 marks]

b) Distinguished between direct debit and standing order. Provide an example for each one.

[10 marks]