From the following information prepare a Bank Reconciliation statement as on 31st March, 2022 for A Ltd. ₹ Bank overdraft as per cash book as 31st March, 2022. 15,50,750 1 Cheques deposited on 15th February, 2022 credited on 5th April,2022 12,50,000 2 Interest debited by bank on 31st March, 2022 1,75,500 3 Cheques issued before 31st March, 2022 but not yet presented 7,75,000 4 On 10th March, 2022 bank credited to A Ltd, in error 1,5o,ooo 5 Draft deposited in bank but not credited till 31st March, 2022 12,75,000 6 Bills for collection credited by bank but no advice received by the company 9,45,000 7 Bank charges charged by bank not entered in Cash Book 2,85,000 8 Transport subsidy received from the State Government directly by the bank not advised to the company 17,50,000 [June. 2023, 5 Marks]

Pass the necessary Journal entries to rectify the following errors, using a Suspense Account: (i) Goods of the value of 500 returned by Mr. A were entered in the Sales Day Book and posted there from to the credit of his account; (ii) 250 entered in the Sales Returns Book, has been posted to the debit of Mr. R, who returned the goods; (iii) A sale of 700 made to Mr. Q was correctly entered in the Sales Day Book but wrongly posted to the debit of Mr. S as 70; (iv) The total of "Discount allowed" Column in the Cash Book for September amounting to 350 was not posted. [Sept. 2024, 4 Marks]

Meaning of Bank Reconciliation Statement.

Importance of bank reconciliation to an industrial unit. [RTP Jan 2025]

The interest charged by Banker to customer on overdrawn account is called Red ink interest.

Bank reconciliation statement is prepared to arrive at the bank balance.

Interest charged by the bank will be deducted, when the overdraft as per the cash book is the starting point for making the bank reconciliation statement.