Senior High School

Fundamentals of
Accountancy,
Business and
Management
2 Quarter 2 – Module
7.2:
Bank Reconciliation
Statement
 Writer:
NESSA B. DIMALANTA
Teacher-II BACOLOR HIGH SCHOOL
Editors:
JANE P. VALENCIA, ED. D., EPS Mathematics
CHAIRMAN
BETHEL GRACE M. GUIAO- Teacher-III
VIENNAH MARIE M. BUSTOS Teacher-II

What I Need to Know

This module was designed and written with you in mind. It is here to help you master
the Bank Reconciliation Statement. The scope of this module permits it to be used in
many different learning situations. The language used recognizes the diverse
vocabulary level of students. The lessons are arranged to follow the standard sequence
of the course. But the order in which you read them can be changed to correspond
with the textbook you are now using.
The module has one lesson, namely:
Lesson 2: Analyze the effects of the identified reconciling items and bank
reconciliation statements preparation.
After going through this module, you are expected to:
1. analyze the effects of the identified reconciling items;
2. preparing bank reconciliation statements.
 What I Know
TRUST YOURSELF, YOU KNOW MORE THAN YOU THINK YOU DO.
MULTIPLE CHOICE. Write the chosen letter on a separate sheet of paper.
1. Brix company has a P1,860,000 balance per book, a P311,000 deposit in transit,
P53,000 outstanding checks, a P56,000 credit memo, and a P129,000 NSF check.
What is the adjusted cash balance?
P1,787,000
A. P1,585,000
D.
B.
P1,722,000
P1,975,000
C.
2. Max Co. has a P2,000,000 cash balance per books, P521,000 deposit in transit,
P543,000 outstanding checks, P591,000 notes collected by the bank from the entity's
customers, P1,200 bank service charge and P88,400 DAIF check. What is the adjusted
cash balance?
P2,501,400
A. P2,048,000
D.
B.
P2,179,000
P2,502,600
C.
3. AC company has a P1,800,000 cash balance per bank statement, P685,000 deposits
in transit, P536,000 NSF check, P200,000 erroneous deduction by the bank from the
company's account, and P380,000 outstanding checks. What is the adjusted cash
balance?
C.P1,264,000
A. P1,841,000
D.
B.
P2,336,000
P2,377,000

1
4. ABC company has P1,000,000 cash balanced per bank statement P550,000 deposit
in transit 900 interest earned on the deposit not yet recorded in the books of accounts,
1,000 bank service charge, and P200,100 outstanding check. What is the adjusted
cash balance?
C.P1,349,100
A. P1,350,000
D.
B. P1,750,
P1,351,000
100
5. Carlos Repairs has a P1,500,000 cash balance per bank statement P600,000 deposit
in transit, P5,000 interest earned on the deposit, net of tax, P1,000 service charge,
P250,000 outstanding checks, and P90,000 NSF check. What is the adjusted cash
balance?
P1,349,100
A. P2,114,000
B. P1,750, D.
100 P1,850,000
C.
6. Carol Laundry Shop has a P2,300,000 cash balance per bank statement, a P398,000
deposit in transit, P320,000 NSF checks, and a P200,000 outstanding check. What is
the adjusted cash balance?
P2,498,000
A. P2,178,000
D.
B.
P2,142,000
P2,620,000
C.
7. Miracle Builders has P1,478,000 cash balance per bank statement, P533,000
deposit in transit, P233,000 NSF check, P205,000 erroneous credit by the bank to the
entity's account, and P221,000 outstanding check. What is the adjusted cash
balance?
C. P1,542,000
A. P1,585,000
D.
B.
P1,818,000
P1,352,000
8. Cristine, the bookkeeper, erroneously recorded a deposit of P420 as P720. What is
the adjustment in the bank reconciliation?
A. P720 addition to the book balance
B. P720 deduction from the book balance
C. P300 addition to the book balance
D. P300 deduction from the book balance
9. Boyet Computer Store recorded a check withdrawal of P78,400 as P76,400. The
check cleared the bank at the correct amount of P78,400. What is the adjusted correct
cash balance per book?
A. P78,400 addition to the book balance.
B. P78,400 deduction from the book balance.
C P2,000 addition to the book balance.
D. P2,000 deduction from the book balance.
10. XYZ company's records show a cash balance of P31,200, but the bank statement
shows a balance of P30,000. If there is only one reconciling item, the P1,200 difference
would most likely be a(an)
check. D. NSF check
A. credit memo.
B. overstated book credit.
C. outstanding
2
 Lesso Analyze the effects of the
n 2 identified reconciling
items and bank
reconciliation statements
preparation
It is usual for a company's bank balance as per accounting records to differ from the
balance as per bank statement. The difference between these figures is the reasons
why companies prepare a bank reconciliation statement. Bank reconciliation
statement is a report which compares the bank balance as per the company's
accounting records with the balance stated in the bank statement.

What’s In
FIX ME! Arrange the scrambled words.
1. DRTIEC MOEM CREDIT MEMO____ 2. TSOIDEP IN SAINTRT
_______________________________ 3. ABKN ELCCIAONITNIOR TTEENASMT
_______________________________ 4. BDTIE MOME
_______________________________ 5. NKAB SIERCEV CRGEAH
_______________________________ 6. LCREIOPRAC UCTCNSAO
_______________________________ 7. TDNUINTASOG CKCHES
_______________________________ 8. SETTIENR COEINM
_______________________________ 9. BKOO RESORR
_______________________________ 10. AUOT DBTIE
_______________________________

What’s New
Everyone makes a mistake; the only thing you can do is find ways and fix it.
Determine the amount of the error and state whether the amount will be added or
deducted in the preparation of the bank reconciliation (use adjusted method): Write
your answer on a separate sheet of paper.
1. Romel Repairs received Ᵽ2,000 from Alessandro. The company recorded the amount
as Ᵽ200.
2. Pampanga Bank collected from the customer of Romel Repairs the sum of Ᵽ7,000
representing the said customer's payment to Romel Repairs. No entry made in the
books of Romel Repairs.
3. The bank teller debited a check amounting to Ᵽ2,500 from the account of Romel
Repairs. The said check issued by Romel Refrigeration, a different depositor of the
bank.
 3
4. Romel Repairs recorded in the Cash Disbursement Journal a check amounting to
Ᵽ4,010. The correct amount of the check was Ᵽ4,100.

5. Romel Repairs deposits gained the interest of Ᵽ200 for the month. Romel Repairs did
not know of any interest gained until the bank statement was received.

What is It
Analysis of the Effects of the Identified Reconciling Items
TRANSACTION NAME OF ADD/ ADD/DEDU
THE BANK / DEDUCT CT TO BANK
BOOK TO BOOK
RECONCILIN
G ITEM
1. A check of Ᵽ35, 000 Outstandi Deduct to bank
issued to a supplier, was ng Check
not yet presented as
payment to the bank
2. Ᵽ1,500 cash received by the Deposit in Add to bank
company, recorded on Transit
March
31, however, the cash
deposited at the bank on the
afternoon of
April 1.

3. The bank erroneously Bank Error Deduct to

added Ᵽ12,000 deposit of bank Note:
Rommel Upholstery Co, The cash
to Rommel Repairs bank balance
account. overstated,
thus the
correction is
a deduction
of P Ᵽ12,000
to the cash
bank
balance
4. The teller erroneously Bank Error Add to bank
debited Ᵽ20,000 to Note: The
Rommel Repairs account cash bank
instead of Ᵽ2,000. balance was
understated;
thus the
correction is
an addition
of
Ᵽ18,000
(20,000-2,00
0) to the
cash
 bank balance
5. The customer deposited Collection Add to book
Ᵽ10,000 to the company’s of
bank account as payment receivable
of receivable but not s
recorded in the directly
company’s book. received by
the bank
(Credit
Memo)
6. Payment of electric Auto Debits Deduct to
bills automatically (Debit Memo) book
deducted
on the company’s bank
account

4
7. A collection of Ᵽ10,000 Book Error Add to
recorded in the book
company’s book as Note: The
Ᵽ1,000. The bank cash book
statement shows the balance
correct amount of was
Ᵽ10,000 understate
d; thus
the
correction
is an
addition
of Ᵽ9,000
(10,000-
1,000) to
the cash
book
balance
8. A collection of Ᵽ5,000 Book Error Deduct to
recorded in the book
company’s book as Note: The
Ᵽ50,000. The cash book
bank statement shows balance
the correct amount of overstate
Ᵽ5,000 d; thus
the
correction
is a
deduction
of Ᵽ45,000
(5,000-
50,000) to
the cash
book
balance
9. Charge for printing Bank Deduct to
company checks and Service book
service fee Charge
 (Debit
Memo)
10.Interest credited to Interest Add to book
the bank account Income
(Credit
Memo)
11. The bank statement NSF- No Deduct to
shows a return check of sufficient book
Ᵽ500 by the customer. fund (Debit
Memo)

Illustrations are as follows using the Adjusted Method Bank

Reconciliation Format
PER BOOK
Unadjusted Book Balance Ᵽ XX

Add: Credit Memo

Interest Income XX
Collection received by the bank XX
Less: Debit Memo
NSF Checks (XX)
Bank Service Charge (XX)
Add/Less: Book errors XX
Adjusted Book Balance Ᵽ XX

PER BANK
Unadjusted Bank Balance Ᵽ XX

5
Add: Deposit in Transit (DIT) XX
Less: Outstanding Checks (OC) (XX)
Add/Less: Bank errors XX
Adjusted Bank Balance Ᵽ XX

ILLUSTRATION 1: TRANSACTION ANALYSIS

Kayanatin Repairs March 2020 bank statement shown Ᵽ510,000 balance. As of March
31, 2020, accounting records had a cash balance of Ᵽ710,000. Determined the
following information.
a. Kayanatin Repairs issued a check amounting Ᵽ55,000 to a supplier, which not yet
presented to the bank for payment.
b. A deposit slip no. 1234 was a check deposit amounting to Ᵽ305,000, which not yet
added to the company's account.
c. Collection of account receivable amounting to Ᵽ70,000 deposited by a customer
directly to the company's account, which not yet recorded to the company's record. d.
The bank directly takes out Ᵽ20,000 as payment to the company's monthly PLDT bill.
Requirement: Analyze the transactions and prepare the Bank Reconciliation
Solution:
a. The check of Ᵽ55,000 issued to the supplier but not yet encashed is an
Outstanding check, which deducted to the bank cash balance.
b. The check deposited of Ᵽ305,000 but not yet credited to the company's bank
account is a Deposit in Transit added to the bank cash balance.
c. The collection of Receivable amounted to Ᵽ70,000 is not yet recorded to the
company's cash balance. Therefore, it should be a Credit Memo added to the
company's book balance.
d. Ᵽ20,000 payment or auto-debit should be deducted to the cash book balance as
a Debit Memo since the company's had no record of it yet.
e.
Kayanatin Repairs
Bank Reconciliation
For the month ended March 31, 2020
PER BOOK
Unadjusted Book Balance Ᵽ 710,000

Add: Credit Memo 70,000

Less: Debit Memo (20,000)
Adjusted Book Balance Ᵽ 760,000

PER BANK
Unadjusted Bank Balance Ᵽ 510,000

Add: Deposit in Transit (DIT) 305,000

Less: Outstanding Checks (OC) (55,000)
Adjusted Bank Balance Ᵽ 760,000

ILLUSTRATION 2: USE OF FORMAT

Agyumu Repairs received June 2020 bank statement showing Ᵽ330,000 cash balance.
Accounting records cash balance shows Ᵽ200,000. Determined the following
reconciling items:

6
a. Credit Memo – Ᵽ19,000
b. Interest Income – Ᵽ100
 c. Debit Memo – Ᵽ4,000
d. Deposit in Transit – Ᵽ60,000
e. Outstanding Checks – Ᵽ55,900
Requirement: Prepare the Bank Reconciliation
Solution:
Agyumu Repairs
Bank Reconciliation
For the month ended June 30, 2020
PER BOOK
Unadjusted Book Balance Ᵽ 200,000

Add: Credit Memo 19,000

Interest Income 100
Less: Debit Memo (5,000)
Adjusted Book Balance Ᵽ 214,100

PER BANK
Unadjusted Bank Balance Ᵽ 330,000

Add: Deposit in Transit (DIT) 60,000

Less: Outstanding Checks (OC) (55,900)
Adjusted Bank Balance Ᵽ 214,100

ILLUSTRATION 3: BANK RECONCILIATION

The accountant of Ikawpa Repairs obtained the following information for preparing the
bank reconciliation for the month of April 2020.
Subsidiary Ledger
Cash in Bank- Pampanga Bank Current Account
Date Description Debit Credit Balance
4/1 Bal. forwarded 360,000 100,000 460, 000
4/10 Deposit 820, 000
4/11 Check #109 580,000 300,000 720,000
4/11 Deposit 60,000 1,300,000
4/18 Check #110 180,000 1,000,000
4/21 Check #111 940,000
4/27 Check #112 250,000 760,000
4/30 Deposit 1,010,000
 PAMPANGA BANK
Account Number: 1234-567-89
Account Type: PB Checking Account
Branch: Malaut Branch
Period Covered: 4/1/2020-4/30/2020
Date Description Ref Details Debit Credit Balance
4/10/ Beginning Bal. 032 Ale 35,000 360,000 460, 000
20 Cash Deposit 091 Co. 100,000 580,000 820, 000
4/11/ Cash Deposit 010 Ale 300,00 1,400,00
20 Payment 039 Co. 0 0
4/12/ Ck 098 1,365,00
20 Encashment 065 Ck#1 180,000 80,000 0
4/15/ Ck 075 09 1,265,000
20 Encashment Ck#1 965,000
4/18/ Check 10
20 Deposit Ale 1,045,00
4/26/ Ck Encashment Co. 0
20 Ck#112 865,000
4/29/
20

7
Solution:
Compare the amount in the ledger and the bank statement to determine the
reconciling items.
Bank reconciling items are the amount in the ledger but not in the bank statement.
a. From ledger dated 4/21, Ck#111 amount Ᵽ60,000 is an outstanding check
b. From ledger dated 4/30, Deposit amount Ᵽ250,000 is a deposit in transit
Book reconciling items are the amount in the bank statement but not in the ledger.
a. From the bank statement dated 4/12 described as PAYMENT amount, Ᵽ 35,000
is a Debit Memo
b. From bank statement dated 4/26 described as CHECK DEPOSIT amount Ᵽ
80,000 is a Credit Memo
Ikawpa Repairs
Bank Reconciliation
For the month ended April 30, 2020
PER BOOK
Unadjusted Book Balance Ᵽ1010,000

Add: Credit Memo 80,000

Less: Debit Memo ( 35,000)
Adjusted Book Balance Ᵽ1,055,000

PER BANK
Unadjusted Bank Balance Ᵽ 865,000

Add: Deposit in Transit (DIT) 250,000

 Less: Outstanding Checks (OC) (60,000)
Adjusted Bank Balance Ᵽ1,055,000

ILLUSTRATION 4: BANK/BOOK ERRORS

Kayanatin Repairs had the following information in preparing it's August 31, 2019
bank reconciliation.
a. Bank statement has an end balance of Ᵽ80,000
b. NSF Check shows Ᵽ60,000
c. Ᵽ 32,000 Deposit in Transit
d. Ᵽ27,000 Outstanding Checks
e. Book balance August 32, 2019 is Ᵽ143,000
f. Bank erroneously added a Ᵽ12,000 deposit of Sipag Co. to Kayanatin Repairs
g. Book recorded a collection of Ᵽ120,000, which supposed to be Ᵽ220,000. The correct
amount shown in the bank statement is 220,000.
Requirement: Prepare the Bank Reconciliation
Solution:
❖ Bank error was the error made by the bank adding Ᵽ12,000 deposit of Sipag Co.
to Kayanatin Repairs, which cause the cash balance per bank overstated.
Therefore, the correction of Ᵽ12,000 is a deduction to the cash balance per bank.

8
❖ T-account analysis
❖ Entry Made Should be Entry
CASH
CASH Dr. Cr.
Dr. Cr.

g. Ᵽ12,000
g. -
Bal. Ᵽ12,000 Bal. -

Correction made

CASH
Dr. Cr.
Ᵽ 12,000

(deduct) Ᵽ 12,000
Bal. -

• Overstated by Ᵽ12,000
❖ Book Error was the collection of Ᵽ220,000 was erroneously recorded as
Ᵽ120,000, which understated the cash balance per book. Therefore, the
 correction of Ᵽ100,000(220,000-120,000) added to the cash book balance.
T-account analysis
Entry Made Should be Entry
CASH
CASH
Dr. Cr. Dr. Cr.
a. Ᵽ 120,000 h. Ᵽ 120,000
Bal. Ᵽ 120,000 Bal. Ᵽ 220,000

Correction made

CASH
Dr. Cr.
Ᵽ 120,000

(add) 100,000
Bal. Ᵽ 220,000

• Understated by Ᵽ100,000 (220,000-120,000)

Book Errors:
Nature of Error Effect on the Correction
ending cash
balance
Book debit Understatement Add (Debit) the
understated (Kulang) amount
(Kulang sa understated
pagdagdag) (dagdagan)
Book debit Overstatement Deduct (Credit)
overstated (Sobra (Sobra) the amount
sa pagdagdag) overstated
(bawasan)
Book credit Overstatement Deduct (Credit)
understated (Sobra) the amount
(Kulang sa overstated
pagbawas) (bawasan)
Book credit Understatement Add (Debit) the
overstated (Sobra (Kulang) amount
sa pagbawas) understated
(dagdagan)

9
Bank Errors:
Nature of Error Effect on the Correction
ending cash
balance
 Bank debit Overstatement Deduct (Debit)
understated (Sobra) the amount
(Kulang sa overstated
pagbawas) (bawasan)
Bank debit Understatement Add (Credit) the
overstated (Sobra (Kulang) amount
sa pagbawas) understated
(dagdagan)
Bank credit Understatement Add (Credit) the
understated (Kulang) amount
(Kulang sa understated
pagdagdag) (dagdagan)
Book credit Overstatement Deduct (Debit)
overstated (Sobra (Sobra) the amount
sa pagdagdag) overstated
(bawasan)

Notes to the Teacher

For our learners, the adjusted method used, which commonly used in actual
accounting practice. The two remaining methods are discussed in their higher
accounting subjects as they wish to pursue an accounting degree.

What’s More
Activity 1
Have you ever been in a situation you need to know what’s left or the balance
in your allowance? Below will make you experience it.
Given the following information, compute the correct cash balance using the adjusted
method. Write your answer on a separate sheet of paper.
Balance per bank Ᵽ20,100 Deposit in Transit 1,500 Outstanding
Checks 2,350 Balance per book 19,555 Additional Information:
Collection of Ᵽ130 was recorded by book as Ᵽ310
Auto-debit of Ᵽ125 for mobile data
Requirement: Compute for the correct cash balance:

_____________________ Assessment 1

10
It is not easy to search for things missing, it will make you dizzy, but if you
have the perseverance to find it, you will be able to answer what is asked
below.
Given the following information, compute the missing information using the adjusted
method. Write your answer on a separate sheet of paper.
Sulong CO.’s cash has the following information
a. Cash balance per bank Ᵽ 9,000
b. Credit Memo 5,000
c. Debit Memo 2,000
d. Deposit in Transit 5,000
e. Outstanding Checks 2,000
Requirement: How much is the cash unadjusted book balance?

Activity 2
Typo errors happen, even when you send messages via text, though still, you
correct it by sending another message which same goes with this activity, you
will be able to correct it.
For the month of May 2019, Kulot Company issued the following checks as recorded
in its Cash Disbursement Journal:
Check Date Check No Payee Amount
5/2/2019 1256 Mary Ᵽ 1,000

5/10/2019 1257 Jane 400

5/15/2019 1528 Alessandro 2,500
5/18/2019 1259 Alejo 9,500
5/30/2019 1260 Dan 2,300

As per the bank statement received by Tope, the following checks were presented and
paid by the bank:
Check No. Payee Amount
1256 Mary Ᵽ 1,000

1259 Alejo 9,500

1260 Dan 2,300

Requirement: Identify the outstanding checks as of the end of May 2019. Write
your answer on a separate sheet of paper.
Assessment 2
Practice makes perfect. By correcting mistakes, you’ll have tons of ways.
The cash receipts journal of Malaya Merchandising reflected the following collections
for the month of April 2019:
Official Receipt Official Receipt No. Customer Amount
Date
5/2/2019 1256 Mary Ᵽ 6,000
 5/8/2019 1257 Jane 3,000
5/9/2019 1528 Alessandro 900
5/25/2019 1259 Alejo 800
5/26/2019 1260 Dan 3,000
5/30/2019 1261 Juven 4,500
5/30/2019 1262 Net 4,000

11
It is the policy of the company to deposit collection within the following day from the
date of collection.
The bank statement for April 2019 revealed following deposits made:
Deposit Date Amount
5/3/2019 Ᵽ 6,000
5/9/2019 3,000
5/10/2019 900
5/26/2019 800
5/26/2019 3,000
Requirement: Compute for the deposit in transit or undeposited collection as of
end of April 2019. Write your answer on a separate sheet of paper.
Activity 3 Check Me!
Determine whether the following reconciling items should be added to the book
or bank account balance or deducted from the book or bank account balance by
putting a (√) checkmark. Write your answer on a separate sheet of paper.
RECONCILING ITEMS ADD DEDU ADD DEDU
TO CT TO CT
BOOK FROM BANK FROM
BOOK BANK
1. Jodi Dela Cruz Company had a
receipt of Ᵽ100,000 and correctly
prepared its bank deposit slip for
Ᵽ100,000. However, the company
recorded the receipt in its Cash
account as Ᵽ101,000. How is the
difference of Ᵽ1,000 handled on the
bank reconciliation?
2. Blaze Mudlong wrote a check worth
Ᵽ46,000, and it cleared the bank for
Ᵽ46,000. However, the company
recorded the receipt in its Cash
account as Ᵽ64,000. How is the
difference of Ᵽ18,000 handled on the
bank reconciliation?
3. Bank erroneously posted another
company’s Credit memo to MN Mitz
 Company bank account
4. Bank inadvertently charged Mikka
Joson Company’s bank account for
another Company’s bank fees
5. Bank service charge
6. Deposit in transit
7. The fee charged by the bank for a
returned check
8. Interest credited to the bank account
9. Outstanding checks
10. The bank collected a Note
Receivable for the Acer Garcia
Corporation and Credited the
company’s bank account for
Ᵽ1,000,000

Assessment 3
12
After fixing and correcting, what do you think will be next?
Prepare for the Bank Reconciliation of Matiaga Company for the month of
September 30, 2019. Write your answer on a separate sheet of paper.
a. The bank statement for September 2019 shows an ending balance of Ᵽ3,490.
b. On September 30, the bank statement shows charges of Ᵽ35 for the service charge
for maintaining the checking account.
c. On September 26, the bank statement shows a returned item of Ᵽ100 plus a related
bank fee of Ᵽ10. The returned item is a customer's check returned because of
insufficient funds.
d. The bank statement shows a charge of Ᵽ80 for check printing on September 22.
e. The bank statement shows that Ᵽ8 was added to the checking account on September
30 for interest earned by the company during September.
f. The bank statement shows that a note receivable of Ᵽ1,000 was collected by the bank
on September 29 and deposited into the company's account. On the same day, the
bank withdrew Ᵽ40 from the company's account as a fee for collecting the note
receivable.
g. The company's Cash account at the end of September shows a balance of Ᵽ967.
h. During September, the company wrote checks totaling more than Ᵽ50,000. As of
September 30, Ᵽ3,021 check written in September had not yet cleared the bank, and
Ᵽ200 of checks written in July had not yet cleared the bank.

i. The Ᵽ1,450 cash received by the company on September 29 recorded on the

company's books as of September 30. However, the Ᵽ1,450 of cash receipts deposited
at the bank on the morning of October 1.
j. On September 29, the company's Cash account shows cash sales of Ᵽ145. The bank
statement shows that the amount deposited was Ᵽ154. The company reviewed the
transactions and found that Ᵽ154 was the correct amount.
 What I Have Learned
Now you have been practicing fixing, correcting, and preparing; lets checked if
those are enough.
December 31, 2019, Maganda Company shows a cash balance in the general ledger of
Ᵽ 7,100. Maganda Company received the bank statement on December 31, 2019, with
a balance of Ᵽ7,820. The bank statement and general ledger account showed the
following information:
Deposit in Transit Ᵽ 1,200

Collection of account receivable 755

Interest Income 70
Auto Debit of PLDT bill 320
NSF Check 455
Outstanding Check 580
Bank Charges 30

13
Maganda Company recorded a check received from customers amounting Ᵽ2,120. The
bank statement showed that the customer checks cleared at the amount of Ᵽ2,210.
The bank erroneously deducted Ᵽ210 from the Maganda Company account, a check
issued by another company.
Requirement: Prepare for the Bank Reconciliation of Maganda Company for the
month of December 31, 2019. Write your answer on a separate sheet of paper.

What I Can Do
To gauge understanding in the activities provided, better answer the questions
provided below.
MULTIPLE CHOICE. Write the correct letter of your answer on a separate sheet of paper.
1. Masigasig Company issued a check for Ᵽ56, and it cleared the bank for Ᵽ56.
However, the company recorded the check on its cash ledger as Ᵽ66. How is the
difference of Ᵽ10 be treated on the bank reconciliation?
A. Add to BOOK Balance B. C. Add to BANK Balance D.
Deduct from BOOK Balance Deduct from BANK Balance
2. Bank incorrectly charged the company account for Masipag Company's bank service
charge.
A. Add to BOOK Balance B. C. Add to BANK Balance D.
Deduct from BOOK Balance Deduct from BANK Balance
3. Bank mistakenly post Masipag Company's credit memo to Masigasig Company bank
account.
A. Add to BOOK Balance
B. Deduct from BOOK Balance 4. BELIEVE IN YOURSELF! You can do
Interest charged to the bank account
it! Bank Reconciliation Problem
A. Add to BOOK Balance
B. Deduct from BOOK Balance 5. C. Add to BANK Balance D. Deduct
from BANK Balance
Interest credited to the bank account
A. Add to BOOK Balance
B. Deduct from BOOK Balance C. Add to BANK Balance D. Deduct
from BANK Balance

C. Add to BANK Balance D. Deduct

Assessment from BANK Balance

The bank statement for Kulot Company shows a balance per bank of Ᵽ15,907.45 on
April 30, 2015. On this date, the balance of cash per book is Ᵽ11,589.45.
Additional information is provided below:
Deposits in transit:
April 30 deposit (received by the bank on May 1) Ᵽ2,201.40
14
Outstanding checks:
No. 453- Ᵽ3,000.00
No. 457- Ᵽ1,401.30
No. 460- Ᵽ1,502.70
Errors:
Juan wrote the check no. 443 for Ᵽ1,226.00, and the bank correctly paid that amount.
However, he recorded the check as Ᵽ1,262.00.
Bank memoranda:
Debit– NSF check from Pedro Ᵽ425.60.
Debit– Charge for printing company checks Ᵽ30.00
Credit – Collection of a note receivable for Ᵽ1,000 plus interest earned of Ᵽ50, less
bank collection fee of Ᵽ15.00.
Required: Prepare a bank reconciliation statement using the adjusted method.
Write your answer on a separate sheet of paper.

Additional Activities
Be enthusiastic about achieving your goal.
EOREDRCD EACANLB
OOKB ACLDEER
 RWEON

Fill in the blanks by choosing your answer to the scrambled word box. Write your
answer on a separate sheet of paper.
1. The person or company writing a check is the __________ of the check
2. Items on the bank statement that are not yet on the company's books will need to be
___________ on the books.
3. A check that has been paid and therefore appears on the bank statement is said to
have _________ the bank.
4. The adjusted balance per bank statement should agree with the adjusted balance
per _________.
5. A bank service charge is a deduction from the _________ per books

15
book 4.

Answer Key
balance 5. Balance 12,204.85 Ᵽ
Add to BOOK a. 5.
cleared 3. deducted in
recorded 2. P90 will be 4.
owner 1. records.
added to bank
Activity P2,500 will be 3.
dditional A books
added to the
P7,000 will be 2.
books.
records added to the
to the book P1,800 will be 1. 930 , 7 Ᵽ
balance
P200 is added 5. ’s New What d cash
records Adjuste 1.
the book
 C 2.
Learned C 1.
Have What I Know
What I
BOOK Balance
Deduct from b. 4.
BANK Balance
Deduct from d. 3.
Balance 1,719 Ᵽ 1.
Add to BANK c. 2. 9. Deduct from Bank 10 Add to
BOOK Balance 3 Assessment Book 7. Deduct from Book 8. Add
from Deduct b. 1. 00 5, 8 Ᵽ 1.
to Book 5. Deduct from Book 6.
Add to Bank Bank
Can Do What I 2 Assessment 3. Deduct from Bank 4. Deduct
from Book
AUTO DEBIT 10. 9,000 Ᵽ 1. 1. Deduct from Book 2. Deduct
BOOK ERRORS 9. Assessment 1 from Activity 3
INTEREST INCOME 8.
CHECKS ’s More hat W
OUTSTANDING 7. Adjusted cash balance ,500 2
ACCOUNTS Ᵽ for Alessandro issued to 00
RECIPROCAL 6. Assessment and Check 1528 4 Ᵽ for
CHARGE Jane Check 1257 issued to 1.
SERVICE BANK 5.
DEBIT MEMO 4. Activity 2
STATEMENT D 10.
RECONCILIATION D 9.
BANK 3. D 8. 19,250 Ᵽ 1.
DEPOSIT IN TRANSIT 2. A 7.
CREDIT MEMO 1. C 6. Activity 1
NI ’s What D 5.
C 4. ’s More What
B 3.

16
References:
By
• Curriculum Guide in Fundamentals of Accountancy, Business and
Management 2
• Beticon, J. L, & Domingo, J. D, & Yabut, F. D. (2016).
Fundamentals of Accountancy, Business, and Management 2
Teacher’s Manual (2016). Quezon City: Vibal Group, Inc.
• Fundamentals of ABM 2: Senior high school SHS teaching guide.
(2019, April 3). Retrieved from
https://www.teacherph.com/fundamentals-abm-2-senior-high-school
teaching-guide/
• Ferrer, R. C, & Millan, Z. B., (2018). Fundamentals of
 Accountancy, Business, and Management 2 (2nd ed., Ser. 2018).
Baguio: Bandolin Enterprise.

17
Development Team of the Module
Writers: Nessa B. Dimalanta
Editors: Jane P. Valencia, Ed. D., EPS - Mathematics
Reviewers: Bethel Grace M. Guiao/Viennah Marie M. Bustos
Illustrator: Nessa B. Dimalanta
Layout Artist: Nessa B. Dimalanta
Management Team:
ZENIA G. MOSTOLES, EdD, CESO V, Schools Division Superintendent
LEONARDO C. CANLAS, EdD, CESE. Asst. Schools Division Superintendent
ROWENA T. QUIAMBAO, CESE, Asst. Schools Division Superintendent
CELIA R. LACNALALE, PhD, CID Chief
JANE P. VALENCIA, EdD, Education Program Supervisor, Mathematics
JUNE E. CUNANAN, Education Program Supervisor/ Language Editor
RUBY M. JIMENEZ, PhD., Education Program Supervisor, LRMDS
18