You have just been appointed as the senior accountant of Moore Retailers and your first task is to prepare the bank reconciliation statement as at 30 June 2017. The junior bookkeeper wanted to make a good first impression and has tried to draft the reconciliation, but he is very inexperienced and has made several mistakes in the process.

Bank reconciliation statement as at 30 June 2017 4 737 DR Balance as per bank statement at 1 June 2017 (favourable) Outstahding cheques CC604 (dated 2 December 2016) 1198 396 CC1120 (dated 28 June 2017) CC1121 (dated 29 June 2017) 3 594 598 CHQ321 Outstanding deposits: Deposit slip no.49 (dated 3 June 2017) 2096 Deposit slip no.56 (dated 30 June 2017) 7 096 Direct deposit by debtor Masisi 2 402 Correction of error on cheque CC942 995 Balancing number Balance as (2 287) per bank statement at 30 June 2017 (favourable) 7253 DR

Additional information: ,**** * ***** . 1. R Debit balance per the Bank Statement at 30 June 2017 7 253 2. Cheque CHQ321 which appears on the June bank statement was in fact 598 incorrectly debited to the business's account. Debtor Masisi made a direct deposit to settle his account. 2 402

A4. The outstanding deposit (deposit slip no. 49) did appear on the June bank statement; however the amount in the cashbook receipts were incorrectly shown as R2 006. The correction of error on cheque CC942 relates to a mistake made by the business, the amount on the cheque was correct R3 995 as shown on the June bank statement; however it was entered into the cashbook payments at the incorrect amount R3 000. 6. You can assume all other.dates and amounts are correct.

Reguired: (9) Q.1.1 Taking into account all the information presented above, prepare the correct bank reconciliation statement as at 30 June 2017. Correct the layout, terminology, entries, and amounts, as marks will be given to all corrections. Indicate clearly which amounts are added and which amounts are subtracted. (4) Q.1.2 What should the opening balance per the bank account in the general ledger be on 1 July 2017; will this be a debit or credit balance? Q.1.3 What is the (2) correct accounting treatment of a cheque marked "return to drawer Give both the journal for the entry as well as the actual accounting entry (ie. account DR and CR) in your answer.