A debit of Rs 100 appeared in the bank statement for an unpaid cheque, which had been return marked 'out of date'. The cheque had been re-dated by the customer and paid into the bank again on 5th july, 2011.
What will be the treatment when preparing brs starting with a Cr balance as per Pass book
Dear Student,
An unpaid cheque means cheque was deposited into the bank and was later returned unpaid, usually by another bank, because there were insufficient funds or some other reason. They will debit the account for the amount of the cheque plus they will debit a "penalty" charge.
Therefore, Pass Book balance is less than the balance of Cash Book. If we start with Credit balance of Pass Book, we will Add the amount of Rs 100 in order to match the balance of Pass Book with the Cash Book.
For further doubts, do get back to us.
Keep posting!!
An unpaid cheque means cheque was deposited into the bank and was later returned unpaid, usually by another bank, because there were insufficient funds or some other reason. They will debit the account for the amount of the cheque plus they will debit a "penalty" charge.
Therefore, Pass Book balance is less than the balance of Cash Book. If we start with Credit balance of Pass Book, we will Add the amount of Rs 100 in order to match the balance of Pass Book with the Cash Book.
For further doubts, do get back to us.
Keep posting!!