NCERT Solutions For Class 11 Accountancy Chapter 5 Bank Reconciliation Statement

Access NCERT Solutions for Class 11 Accountancy Chapter 5 – Bank Reconciliation Statement

1. State the need for the preparation of a bank reconciliation statement? 
   
   • A bank reconciliation statement helps a business compare its own records with the bank’s records.
   • This checks if the two balances match and finds any differences.
   • It helps spot errors or missing entries in the cash book or passbook.
   • The process lets businesses fix mistakes quickly and keep accurate account balances.
2. What is a bank overdraft? 
   
   • A bank overdraft means spending more money than you have in your bank account.
   • The bank lets you withdraw extra money for a short time and charges interest on this amount.
   • It covers payments even when your account has less money, preventing bounced cheques.
3. Briefly explain the statement ‘wrongly debited by the bank’ with the help of an example. 
   
   • When a bank takes out the wrong amount from someone’s account, it’s called 'wrongly debited'.
   • For example, if you deposit a cheque for Rs. 10,000 but the bank records only Rs. 1,000, that’s a bank error.
4. State the causes of the difference that occurred due to time lag. 
   
   • Time lag happens when the cash book and bank records do not update at the same time.
   • This leads to differences because one book may have entries that the other does not yet show.
   • These timing issues cause temporary mismatches in records.
5. Briefly explain the term ‘favourable balance as per cash book’ 
   
   • A favourable balance in the cash book means there’s more money coming in than going out.
   • This happens when receipts are higher, so the cash book shows a positive balance.
   • It is the starting point for preparing a bank reconciliation statement before any adjustments.
   • It is opposite to an overdraft or negative balance in the passbook.
6. Enumerate the steps to ascertain the correct cash book balance. 
   
   • Check the current balances from both the cash book and passbook.
   • Compare each entry in the passbook with the cash book, and vice versa.
   • Spot and correct any errors or missing entries in the books.
   • Calculate the final balance after corrections for preparing the bank reconciliation statement.
7. What is a bank reconciliation statement? Why is it prepared? 
   
   • A bank reconciliation statement checks that a company’s records and the bank statement agree.
   • It matches the cash book and passbook balances to find and explain the differences.
   • This helps in keeping correct financial records and avoids confusion or mistakes.
8. Explain the reasons where the balance shown by the bank passbook does not agree with the balance as shown by the bank column of the cash book. 
   
   • Time lag: Entries appear in one book before the other (like cheques issued but not yet cleared).
   • Direct deposits: Customers may deposit money directly into the bank without informing the company.
   • Bank charges/interest: The bank adds or removes charges or interest not yet listed in the cash book.
   • Direct dealings: The bank may directly handle payments or receipts like utility bills or rents.
   • Dishonoured cheques: Cheques deposited may bounce, but the business doesn’t record it until checking the passbook.
   • Bank or business errors: Mistakes can occur from either side, causing differences.
9. Explain the process of preparing a bank reconciliation statement with an amended cash balance. 
   
   • Differing entries between the cashbook and passbook are identified and corrected.
   • First, find out balances of both books.
   • Compare debits and credits in both the passbook and cash book to spot differences.
   • Fix any mistakes immediately in the cash book.
   • Add up everything to find the right balance before making the final Bank Reconciliation Statement.
10. From the following particulars prepare a bank reconciliation statement as of March 31, 2017.
    (i) Balance as per cash book Rs 3,200
    (ii) Cheque issued but not presented for payment Rs 1,800
    (iii) Cheque deposited but not collected up to March 31, 2017 Rs 2,000
    (iv) Bank charges debited by bank Rs 150
    
    • Start with cash book balance: Rs 3,200
    • Add: Cheque issued but not presented: Rs 1,800
    • Less: Cheque deposited but not collected: Rs 2,000
    • Less: Bank charges: Rs 150
    • Balance as per passbook is calculated after these steps.
11. On March 31 2017 the cash book showed a balance of Rs. 3,700 as cash at bank, but the bank passbook made up to the same date showed that cheques for Rs. 700, Rs. 300 and Rs. 180 respectively had not presented for payment. Also, cheque amounting to Rs. 1,200 deposited into the account had not been credited. Prepare a bank reconciliation statement.
    
    • Start with cash book balance: Rs 3,700
    • Add: Cheques issued but not presented (Rs 700 + Rs 300 + Rs 180): Rs 1,180
    • Subtract: Cheque deposited but not credited: Rs 1,200
    • The final figure shows your passbook balance.
12. The cash book shows a bank balance of Rs. 7,800. On comparing the cash book with the passbook the following discrepancies were noted :
    (a) Cheque deposited in the bank but not credited Rs. 3,000
    (b) Cheque issued but not yet present for payment Rs. 1,500
    (c) Insurance premium paid by the bank Rs. 2,000
    (d) Bank interest credit by the bank Rs. 400
    (e) Bank charges Rs. 100
    (d) Directly deposited by a customer Rs. 4,000
    
    • Start with cash book balance: Rs 7,800
    • Add: Cheque issued but not presented: Rs 1,500
    • Add: Bank interest credited: Rs 400
    • Add: Direct deposit by customer: Rs 4,000
    • Subtract: Cheque deposited but not credited: Rs 3,000
    • Subtract: Insurance premium by bank: Rs 2,000
    • Subtract: Bank charges: Rs 100
    • Get passbook balance after tallying all adjustments.
13. Bank balance of Rs. 40,000 showed by the cash book of Atul on December 31, 2013. It was found that three cheques of Rs. 2,000, Rs. 5,000 and Rs. 8,000 deposited during the month of December were not credited in the passbook till January 02, 2014. Two cheques of Rs. 7,000 and Rs. 8,000 issued on December 28, were not presented for payment till January 03, 2014. In addition to it, the bank had credited Atul for Rs. 325 as interest and had debited him with Rs. 50 as bank charges for which there were no corresponding entries in the cash book.
    
    • Start with cash book balance: Rs 40,000
    • Subtract: Cheques not credited (Rs 2,000 + Rs 5,000 + Rs 8,000): Rs 15,000
    • Add: Cheques issued but not yet presented (Rs 7,000 + Rs 8,000): Rs 15,000
    • Add: Interest credited by bank: Rs 325
    • Subtract: Bank charges: Rs 50
    • Balance after these steps is as per passbook.
14. On comparing the cash book with the passbook of Naman it is found that on March 31, 2014, a bank balance of Rs. 40,960 showed by the cash book differs from the bank balance with regard to the following :
    (a) Bank charges Rs 100 on March 31, 2014, are not entered in the cash book.
    (b) On March 21, 2014, a debtor paid Rs. 2,000 into the company’s bank in settlement of his account, but no entry was made in the cash book of the company in respect of this.
    (c) Cheques totalling Rs. 12,980 were issued by the company and duly recorded in the cash book before March 31, 2014, but had not been presented at the bank for payment until after that date.
    (d) A bill for Rs. 6,900 discounted with the bank is entered in the cashbook with recording the discount charge of Rs. 800.
    (e) Rs. 3,520 is entered in the cash book as paid into the bank on March 31st, 2014, but not credited by the bank until the following day.
    (f) No entry has been made in the cash book to record the dishonour on March 15, 2014, of a cheque for Rs. 650 received from Bhanu.
    Prepare a reconciliation statement as of March 31, 2014.
    
    • Start with cash book balance: Rs 40,960
    • Subtract: Bank charges: Rs 100
    • Add: Amount deposited by debtor: Rs 2,000
    • Add: Cheques issued but not presented: Rs 12,980
    • Subtract: Discount on bill not recorded: Rs 800
    • Subtract: Cheque not yet credited: Rs 3,520
    • Subtract: Dishonoured cheque not recorded: Rs 650
    • The total gives the passbook balance after all adjustments.
15. Prepare bank reconciliation statement as of December 31, 2017. On this day the passbook of Mr Himanshu showed a balance of Rs 7,000.
    (a) Cheques of Rs 1,000 directly deposited by a customer.
    (b) The bank has credited Mr Himanshu for Rs 700 as interest.
    (c) Cheques for Rs 3,000 were issued during the month of December but these cheques for Rs 1,000 were not presented during the month of December.
    
    • Start with passbook balance: Rs 7,000
    • Add: Direct deposit by customer: Rs 1,000
    • Add: Interest credited: Rs 700
    • Less: Cheques issued but not yet presented: Rs 1,000
    • Total gives cash book balance.
16. From the following particulars prepare a bank reconciliation statement showing the balance as per cash book on December 31, 2016.
    (a) Two cheques of Rs 2,000 and Rs 5,000 were paid into the bank in October 2016 but were not credited by the bank in the month of December.
    (b) A cheque of Rs 800 which was received from a customer was entered in the bank column of the cash book in December 2016 but was omitted to be banked in December 2016.
    (c) Cheques for Rs 10,000 were issued to a bank in November 2016 but not credited by the bank on December 31, 2016.
    (d) Interest on investment Rs 1,000 collected by the bank appeared in the passbook.
    Balance as per Passbook was Rs 50,000
    
    • Start with passbook balance: Rs 50,000
    • Add: Cheques issued but not presented: Rs 10,000
    • Add: Interest on investment: Rs 1,000
    • Less: Cheques deposited but not yet cleared: Rs 2,000 + Rs 5,000 = Rs 7,000
    • Less: Cheque not yet banked: Rs 800
    • Total is the cash book balance.
17. Balance as per the passbook of Mr Kumar is 3,000.
    (a) Cheque paid into bank but not yet cleared Ram Kumar Rs 1,000, Kishore Kumar Rs 500
    (b) Bank Charges Rs 300
    (c) Cheque issued but not presented Hameed Rs 2,000, Kapoor Rs 500
    (d) Interest entered in the passbook but not entered in the cash book Rs 100
    Prepare a bank reconciliation statement.
    
    • Start with passbook balance: Rs 3,000
    • Add: Cheques issued but not presented: Rs 2,000 + Rs 500 = Rs 2,500
    • Add: Interest not yet in cash book: Rs 100
    • Less: Cheques paid in but not cleared: Rs 1,000 + Rs 500 = Rs 1,500
    • Less: Bank charges: Rs 300
    • Total is cash book balance.
18. The passbook of Mr Mohit current account showed a credit balance of Rs 20,000 dated December 31, 2016. Prepare a Bank Reconciliation Statement with the following information.
    (i) A cheque of Rs 400 drawn on his saving account has been shown on the current account.
    (ii) He issued two cheques of Rs 300 and Rs 500 on December 25, but only the Ist cheque was presented for payment.
    (iii) One cheque was issued by Mr Mohit of Rs 500 on December 25, but it was not presented for payment whereas it was recorded twice in the cash book.
    
    • Start with passbook balance: Rs 20,000
    • Add: Cheque wrongly debited: Rs 400
    • Add: Cheque issued but not presented: Rs 500
    • Less: The Rs 500 cheque was recorded twice in cash book: Rs 500
    • Total gives the cash book balance.
19. On 1st January 2017, Rakesh had an overdraft of Rs 8,000 as showed by his cash book. Cheques amounting to Rs 2,000 had been paid in by him but were not collected by the bank by January 01, 2017. He issued cheques of Rs 800 which were not presented to the bank for payment up to that day. There was a debit in his passbook of Rs 60 for interest and Rs 100 for bank charges. Prepare bank reconciliation statement for comparing both the balance.
    
    • Start with overdraft as per cash book: Rs 8,000
    • Add: Cheques issued but not presented: Rs 800
    • Less: Cheques paid in but not yet collected: Rs 2,000
    • Less: Interest and bank charges: Rs 60 + Rs 100 = Rs 160
    • The total is the overdraft as per passbook.
20. Prepare bank reconciliation statement.
    (i) Overdraft showed as per cash book on December 31, 2017, Rs 10,000.
    (ii) Bank charges for the above period are also debited in the passbook Rs 100.
    (iii) Interest on overdraft for six months ending December 31, 2017, Rs 380 debited in the passbook.
    (iv) Cheques issued but not encashed prior to December 31, 2017, amounted to Rs 2,150.
    (v) Interest on Investment collected by the bank and credited in the passbook Rs 600.
    (vi) Cheques paid into bank but not cleared before December 31 2017 were Rs 1,100.
    
    • Start with overdraft as per cash book: Rs 10,000
    • Add: Cheques issued but not encashed: Rs 2,150
    • Add: Interest on investment credited: Rs 600
    • Less: Bank charges: Rs 100
    • Less: Interest on overdraft: Rs 380
    • Less: Cheques paid in but not cleared: Rs 1,100
    • Resulting amount is overdraft as per passbook.
21. Kumar finds that the bank balance shown by his cash book on December 31, 2017, is Rs 90,600 (Credit) but the passbook shows a difference due to the following reason: A cheque (post-dated) for Rs 1,000 has been debited in the bank column of the cash book but not presented for payment. Also, a cheque for Rs 8,000 drawn in favour of Manohar has not yet been presented for payment. Cheques totalling Rs 1,500 deposited in the bank have not yet been collected and the cheque for Rs 5,000 has been dishonoured.
    
    • Start with cash book balance: Rs 90,600 (Credit)
    • Add: Cheques issued but not presented (Rs 1,000 + Rs 8,000): Rs 9,000
    • Less: Cheques deposited but not collected: Rs 1,500
    • Less: Dishonoured cheque: Rs 5,000
    • Total gives passbook balance.
22. On December 31, 2017, the cash book of Mittal Bros. Showed an overdraft of Rs 6,920. From the following particulars prepare a Bank Reconciliation Statement and ascertain the balance as per the passbook.
    (1) Debited by the bank for Rs 200 on account of Interest on overdraft and Rs 50 on account of charges for collecting bills.
    (2) Cheques drawn but not encashed before December 31 2017 for Rs 4,000.
    (3) The bank has collected interest and has credited Rs 600 in the passbook.
    (4) A bill receivable for Rs 700 previously discounted with the bank had been dishonoured and debited in the passbook.
    (5) Cheques paid into bank but not collected and credited before December 31, 2017, amounted to Rs 6,000.
    
    • Start with overdraft as per cash book: Rs 6,920
    • Add: Cheques drawn but not encashed: Rs 4,000
    • Add: Interest collected by bank: Rs 600
    • Less: Interest on overdraft: Rs 200
    • Less: Bank charges for collecting bills: Rs 50
    • Less: Bill receivable dishonoured: Rs 700
    • Less: Cheques paid in but not yet credited: Rs 6,000
    • The total is overdraft as per passbook.
23. Prepare bank reconciliation statement of Shri Bhandari as of December 31, 2014
    (i) The Payment of a cheque for Rs. 550 was recorded twice in the passbook.
    (ii) Withdrawal column of the passbook undercast by Rs. 200
    (iii) A Cheque of Rs. 200 has been debited in the bank column of the Cash Book but it was not sent to the bank at all.
    (iv) A Cheque of Rs. 300 debited to the Bank column of the passbook was not sent to the bank.
    (v) Rs. 500 in respect of dishonoured cheques were entered in the passbook but not in the cash book. Overdraft as per the passbook is Rs. 20,000.
    
    • Start with overdraft as per passbook: Rs 20,000
    • Add: Cheque recorded twice in passbook: Rs 550
    • Add: Passbook undercast: Rs 200
    • Add: Cheque debited in cash book but not sent to bank: Rs 200
    • Add: Cheque debited to passbook but not sent: Rs 300
    • Add: Dishonoured cheque not recorded in cash book: Rs 500
    • Final amount is overdraft as per cash book.
24. Overdraft shown by the passbook of Mr Murli is Rs. 20,000. Prepare bank reconciliation statement dated December 31, 2014.
    (i) Bank charges debited as per passbook Rs. 500.
    (ii) Cheques recorded in the cash book but not sent to the bank for collection Rs. 2,500.
    (iii) Received a payment directly from customer Rs. 4,600.
    (iv) Cheque issued but not presented for payment Rs. 6,980.
    (v) Interest credited by the bank Rs. 100.
    (vi) LIC paid by bank Rs. 2,500.
    (vii) Cheques deposited with the bank but not collected Rs. 3,500.
    
    • Start with overdraft as per passbook: Rs 20,000
    • Add: Bank charges: Rs 500
    • Add: Cheques recorded in cash book but not sent: Rs 2,500
    • Less: Payment received from customer: Rs 4,600
    • Less: Cheques issued but not presented: Rs 6,980
    • Less: Interest credited: Rs 100
    • Add: LIC (insurance) paid by bank: Rs 2,500
    • Add: Cheques deposited but not collected: Rs 3,500
    • Final amount gives overdraft as per cash book.
25. Raghav & Co. have two bank accounts. Account No. I and Account No. II.From the following particulars relating to Account No. I, find out the balance on that account of December 31, 2014, according to the cash book of the firm.
    (i) Cheques paid into bank prior to December 31, 2014, but not credited for Rs. 10,000.
    (ii) Transfer of funds from account No. II to account no. I recorded by the bank on December 31, 2014, but entered in the cash book after that date for Rs. 8,000.
    (iii) Cheques issued prior to December 31, 2014, but not presented until after that date for Rs. 7,429.
    (iv) Bank charges debited by the bank not entered in the cash book for Rs. 200.
    (v) Interest Debited by the bank not entered in the cash book Rs. 580.
    (vi) Overdraft as per Passbook Rs. 18,990.
    
    • Start with overdraft as per passbook: Rs 18,990
    • Add: Cheques not credited: Rs 10,000
    • Less: Transfer from another account not yet in cash book: Rs 8,000
    • Add: Cheques issued but not presented: Rs 7,429
    • Add: Bank charges not in cash book: Rs 200
    • Add: Interest debited not in cash book: Rs 580
    • Final answer is the overdraft as per cash book.
26. Prepare a bank reconciliation statement from the following particulars and show the balance as per the cash book.
    (i) Balance as per passbook on December 31, 2014 overdrawn Rs. 20,000.
    (ii) Interest on bank overdraft not entered in the cash book Rs. 2,000.
    (iii) Rs. 200 insurance premium paid by the bank has not been entered in the cash book.
    (iv) Cheques were drawn in the last week of December 2014, but have not been cleared to date for Rs. 3,000 and Rs. 3,500.
    (v) Cheques deposited into the bank on November 2014, but yet to be credited on dated December 31, 2014, Rs. 6,000.
    (vii) Wrongly debited by bank Rs. 500.
    
    • Start with overdraft as per passbook: Rs 20,000
    • Add: Interest on overdraft not in cash book: Rs 2,000
    • Add: Insurance premium paid by bank: Rs 200
    • Add: Cheques drawn but not cleared: Rs 3,000 + Rs 3,500 = Rs 6,500
    • Add: Wrongly debited by bank: Rs 500
    • Less: Cheques deposited but not yet credited: Rs 6,000
    • The sum is the overdraft as per cash book.
27. The passbook of Mr Randhir showed an overdraft of Rs. 40,950 on March31, 2013. Prepare bank reconciliation statement on March 31, 2013.
    (i) Out of cheques amounting to Rs. 8,000 was drawn by Mr Randhir on March 27 a cheque for Rs. 3,000 was encashed on April 2014.
    (ii) Credited by the bank with Rs. 3,800 for interest collected by them, but the amount is not entered in the cash book.
    (iii) Rs. 10,900 paid in by Mr Randhir in cash and by cheques on March,31 cheques amounting to Rs. 3,800 were collected on April, 07.
    (iv) A Cheque of Rs. 780 credit in the passbook on March 28 being dishonoured is debited again in the passbook on April 01, 2014. There was no entry in the cash book about the dishonour of the cheque until April 15.
    
    • Start with overdraft as per passbook: Rs 40,950
    • Add: Cheques issued but not yet encashed: Rs 3,000
    • Add: Interest collected by bank and not in cash book: Rs 3,800
    • Add: Cheques paid in but not yet credited: Rs 3,800
    • Add: Cheque dishonoured: Rs 780
    • The sum is the overdraft as per cash book.

What You’ll Cover in Bank Reconciliation Statement Class 11 NCERT Solutions

• Learn how a Bank Reconciliation Statement fixes differences between your cash book and the bank’s records.
• Understand reasons for mismatch like timing issues, bank charges, or cheques not yet cleared.
• Follow simple steps to find the true bank balance using Class 11 Accountancy Chapter 5 question answers.
• Practice with typical Bank Reconciliation Statement questions and answers Class 11 for exam readiness.
• Apply these skills in real-life situations, checking both the cash book and bank statement for errors.