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1. ABC Company's books show a cash balance at the commercial bank on October 31, 2021, of Birr 20,502.

2. The bank statement for October shows a balance of Birr 22,190.

3. A deposit of Birr 3,680 does not appear on the bank statement.

4. A cheque written in October but charged in the bank statement:

- Cheque Number 7347: Birr 150
- Cheque Number 7348: Birr 4,820
- Cheque Number 7349: Birr 31

5. ABC has not recorded the Birr 600 of interest collected by the bank.

6. Bank service charges of Birr 18 are not yet recorded by ABC.

7. The bank returned one of ABC's customer's cheques of Birr 220.

8. ABC discovered an incorrectly recorded cheque (#7382) written in October for Birr 131 in payment of accounts payable as Birr 311.

9. A cheque for ABC Company amounting to Birr 175 was incorrectly charged by the bank to ABC's account.

Sagot :

GinnyAnswer
Certainly! Let's go through the reconciliation process step by step for Abc company’s cash and bank balances as of October 31, 2021.

### Information Provided:

1. Book Cash Balance (Abc company's records): [tex]\( \text{Birr} \, 20,502 \)[/tex]
2. Bank Statement Balance: [tex]\( \text{Birr} \, 22,190 \)[/tex]
3. Deposits not appearing in the bank statement: [tex]\( \text{Birr} \, 3,680 \)[/tex]
4. Cheques written but not yet cleared:
- Cheque 7347: [tex]\( \text{Birr} \, 150 \)[/tex]
- Cheque 7348: [tex]\( \text{Birr} \, 4,820 \)[/tex]
- Cheque 7349: [tex]\( \text{Birr} \, 31 \)[/tex]
5. Interest collected by bank not recorded by Abc: [tex]\( \text{Birr} \, 600 \)[/tex]
6. Bank service charge not yet recorded by Abc: [tex]\( \text{Birr} \, 18 \)[/tex]
7. Customer cheque returned by bank: [tex]\( \text{Birr} \, 220 \)[/tex]
8. Incorrect recorded cheque:
- Incorrectly recorded amount: [tex]\( \text{Birr} \, 311 \)[/tex]
- Correct amount: [tex]\( \text{Birr} \, 131 \)[/tex]
- Difference (correction): [tex]\( \text{Birr} \, 311 - \text{Birr} \, 131 = \text{Birr} \, 180 \)[/tex]
9. Incorrect charge by the bank: [tex]\( \text{Birr} \, 175 \)[/tex]

### Steps for Reconciliation:

#### Bank Reconciliation:

Start by adjusting the bank statement balance to account for items not yet reflected on the bank statement:

1. Bank Statement Balance: [tex]\( \text{Birr} \, 22,190 \)[/tex]
2. Add: Deposits not yet recorded by the bank: [tex]\( \text{Birr} \, 3,680 \)[/tex]
3. Less: Cheques written but not yet cleared:
- [tex]\( \text{Birr} \, 150 + \text{Birr} \, 4,820 + \text{Birr} \, 31 = \text{Birr} \, 5,001 \)[/tex]
4. Less: Incorrectly charged cheque by bank: [tex]\( \text{Birr} \, 175 \)[/tex]

Adjusted Bank Balance:
[tex]\[ \text{Birr} \, 22,190 + \text{Birr} \, 3,680 - \text{Birr} \, 5,001 - \text{Birr} \, 175 = \text{Birr} \, 20,694 \][/tex]

#### Book Reconciliation:

Next, adjust the book balance to account for items not yet reflected in Abc’s records:

1. Book Balance: [tex]\( \text{Birr} \, 20,502 \)[/tex]
2. Add: Interest collected by bank: [tex]\( \text{Birr} \, 600 \)[/tex]
3. Less: Bank service charge: [tex]\( \text{Birr} \, 18 \)[/tex]
4. Less: Customer cheque returned by bank: [tex]\( \text{Birr} \, 220 \)[/tex]
5. Add: Correction for incorrectly recorded cheque: [tex]\( \text{Birr} \, 180 \)[/tex]

Adjusted Book Balance:
[tex]\[ \text{Birr} \, 20,502 + \text{Birr} \, 600 - \text{Birr} \, 18 - \text{Birr} \, 220 + \text{Birr} \, 180 = \text{Birr} \, 21,044 \][/tex]

### Summary of Adjustments:

- Adjusted Bank Balance: [tex]\(\text{Birr} \, 20,694\)[/tex]
- Adjusted Book Balance: [tex]\(\text{Birr} \, 21,044\)[/tex]

These adjusted balances reflect all outstanding transactions and errors identified in the reconciliation process. Both should ideally match, indicating a proper reconciliation, although some further investigation might be warranted if discrepancies exist.
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