Question

Maa Dwoa's cash book on 31 st August 20X0 showed an overdraft position of GHS12,350 and her bank statement showed GHS57,750 debit balance. On August 31 st 20X0, a detailed examination of the two statements revealed the following: 5 (i) Dividend amounting to GHS18,000 had been recorded by the bank but entered in the cash book. (ii) A cheque drawn for GHS39,860 had been recorded in the cash book as GHS20,860 (iii) A receipt of GHS60,000 from a customer was paid directly to Maa Dwoa's bank account but no entry was made in the cash book (iv) Cheques paid to suppliers Bro GHS26,900 and Sis GHS39,700 had not been presented for payment. (v) Standing orders totaling GHS24,000 and bank charges of GHS500 entered on the bank statement been omitted from the cash book (vi) A cheque for GHS40,000 received from Yaa was dishonored by the bank but no entry had been made in the cash book. (vii) Bank lodgment GHS43,800, GHS27400, and GHS38,650 on 30 th August 20X0 was not credited by the bank. (viii) A check for GHS14,675 received from a customer was entered as a payment in the cash book. (ix) A check for GHS20,000 recorded in Maa Dwoa's cash book had not been credited by the bank. Required: Prepare Maa Dwoa's adjusted cash book, and reconcile the bank statements as at 31 st August 20X0.

Answer 1

The task involves adjusting Maa Dwoa's cash book with given discrepancies, and then reconciling it with the bank statement as of a specific date. Adjustments include adding unrecorded receipts, deducting omitted charges and correcting amounts, followed by a reconciliation statement for timing differences.

Step-by-step explanation:

The question is asking us to adjust Maa Dwoa's cash book and reconcile it with the bank statement as of 31st August 20X0, considering the discrepancies found between the cash book and bank statement. While this is a complex task that involves several steps including adding, subtracting, and correcting entries in the cash book, the provided information from the singleton scenario can help us to understand basic banking transactions. However, to provide a correct and detailed answer, one must calculate the adjustments needed for the cash book, list them to find the adjusted cash book balance, and then prepare a bank reconciliation statement to match that adjusted cash book balance with the bank statement balance.

For example, one would need to add the direct bank receipts that were not entered in the cash book and deduct the unrecorded bank charges and standing orders. Additionally, cheque and lodgment amounts would need to be corrected. After the cash book is adjusted, the bank reconciliation statement would account for the timing differences such as unpresented cheques and uncredited lodgments to reconcile the two balances.