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Difficulty: HardPreparation of Bank Reconciliation Statement

On 31st October 2026, the Cash Book of Chidiebere Enterprises showed an unadjusted debit balance of NGN 54,200\text{NGN } 54,200. Upon comparing the Cash Book with the bank statement, the following items were identified: a direct credit from a customer of NGN 11,500\text{NGN } 11,500, bank charges of NGN 2,800\text{NGN } 2,800, a standing order payment for insurance of NGN 6,400\text{NGN } 6,400, and a customer's dishonoured cheque of NGN 4,500\text{NGN } 4,500 (none of which were previously recorded in the Cash Book). Furthermore, unpresented cheques amounted to NGN 18,300\text{NGN } 18,300 and uncredited lodgements totaled NGN 14,100\text{NGN } 14,100. What is the balance as per the bank statement on 31st October 2026 in NGN?

Answer: 56200 NGN

Answer

The balance as per the bank statement on 31st October 2026 is NGN 56,200.
The adjusted cash book balance is calculated by starting with NGN 54,200, adding the direct credit of NGN 11,500, and deducting bank charges of NGN 2,800, standing order of NGN 6,400, and dishonoured cheque of NGN 4,500, which yields an adjusted cash book balance of NGN 52,000. Reconciling to the bank statement requires adding unpresented cheques of NGN 18,300 and subtracting uncredited lodgements of NGN 14,100, resulting in a final bank statement balance of NGN 56,200.

Step-by-Step Solution

1
Calculate the adjusted balance of the Cash Book
Adjusted Cash Book Balance = NGN 52,000
Direct credits increase the cash book balance, while bank charges, standing orders, and dishonoured cheques decrease the cash book balance.
2
Reconcile the adjusted cash book balance to arrive at the bank statement balance
Bank Statement Balance = NGN 56,200
Adding unpresented cheques (cheques drawn but not yet presented at bank) and subtracting uncredited lodgements (cheques deposited but not yet credited by bank) converts the adjusted cash book balance to the balance per bank statement.

Key Concept

Preparation of Adjusted Cash Book and Bank Reconciliation Statement
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Topics

Preparation of Bank Reconciliation Statement

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