Bank Reconciliation statements

What is the main objective of preparing a Bank Reconciliation Statement?

1. To prepare the Balance Sheet
2. To ensure that the Cash Book and Pass Book balances are properly reconciled and accounting records remain accurate
3. To calculate depreciation
4. To prepare invoices

Which accounting record maintained by the business contains a bank column?

1. Sales Book
2. Purchase Book
3. Cash Book
4. Journal Proper

The balance shown in the Pass Book represents:

1. Cash available in the office
2. The balance maintained by the bank in the customer's account
3. Profit earned by the business
4. Total sales made by the business

A dishonoured cheque received from a customer will first be recorded by:

1. The business only
2. The bank only
3. Both on the same day always
4. The supplier

Which of the following is an advantage of preparing a Bank Reconciliation Statement regularly?

1. It eliminates the need for bookkeeping.
2. It helps detect frauds and accounting errors.
3. It replaces the Trial Balance.
4. It calculates gross profit.

If a customer deposits money directly into the business bank account, the transaction first appears in:

1. Cash Book only
2. Pass Book only
3. Sales Book only
4. Purchase Book only

Which of the following is NOT a reason for preparing a Bank Reconciliation Statement?

1. Detecting errors in recording transactions
2. Explaining timing differences
3. Calculating depreciation on assets
4. Verifying bank balances

A cheque issued by the business remains unpaid until:

1. It is written in the Cash Book.
2. It is presented to the bank and cleared.
3. It is signed by the supplier only.
4. It is entered into the Journal.

Which document is prepared to explain the reasons for disagreement between the Cash Book and the Pass Book?

1. Trial Balance
2. Trading Account
3. Bank Reconciliation Statement
4. Balance Sheet

Interest credited by the bank directly to the account will first appear in:

1. Cash Book only
2. Pass Book only
3. Journal only
4. Purchase Book

Bank charges recorded by the bank but not yet entered in the Cash Book will:

1. Increase the Cash Book balance
2. Decrease the Pass Book balance only
3. Cause a difference requiring reconciliation
4. Have no effect

Cheques deposited into the bank but not yet collected result in:

1. A higher Cash Book balance than the Pass Book balance
2. No difference between the books
3. A lower Cash Book balance than the Pass Book balance
4. Closure of the bank account

Which of the following causes a difference between the Cash Book and the Pass Book?

1. Depreciation on machinery
2. Cheques issued but not yet presented for payment
3. Purchase of furniture for cash
4. Sale of goods for cash

Which book is maintained by the bank and sent to the account holder?

1. Cash Book
2. Journal
3. Pass Book
4. Ledger

What is the primary purpose of preparing a Bank Reconciliation Statement (BRS)?

1. To calculate depreciation
2. To reconcile the balance shown in the Cash Book with the balance shown in the Pass Book
3. To prepare a Trial Balance
4. To calculate profit