Junior Philippine Institute of Accountants- Holy Bank Reconciling Items:

Angel University 1) Deposits in transit-> are collections already

Financial Accounting 1 Hand-outs
Bank Reconciliation
*Bank Reconciliation-> is a statement which brings into
agreement the cash balance per book and cash balance
per bank.
recorded as cash receipts but not yet reflected on
the bank statement.
2) Outstanding checks-> are checks already
recorded by the depositor as cash disbursements
but not yet reflected on the bank statement.
3) Errors

*Bank Statement-> is a monthly report of the bank to the

depositor showing the cash balance per bank at the Forms of Bank Reconciliation
beginning, the deposits acknowledged, the checks paid, a. Adjusted balance method-> the book
other charges and credits and the daily cash balance per balance and the bank balance are brought
bank during the month. to a correct cash balance that must appear
on the balance sheet.
*Demand deposit-> is a current or checking account or
commercial deposit where deposits are covered by b. Book to bank method
deposit slips and where funds are withdrawable on c. Bank to book method
demand by drawing checks against the bank.
Proforma Reconciliation- Adjusted Balance Method
Book Reconciling Items:
1) Credit memos-> refer to items not representing Book balance
deposits credited by the bank to the account of the xx
depositor but not yet recorded by the depositor as Add: _______________ xx
cash receipts. Total xx
Less: _______________ xx
2) Debit memos-> refer to items not representing Adjusted book balance xx
checks paid by bank which are charged or debited
by the bank to the account of the depositor but not Bank balance
yet recorded by the depositor as cash xx
disbursements. Add: _______________ xx
Total xx
3) Errors Less: _______________ xx
Adjusted Bank balance xx