ExpertHard2 marksMultiple Choice
ACCA · Question 15 · Preparing a Trial Balance
Section A
Blockchain Logistics Ltd has a debit balance of $12,500 on its bank statement. However, the cash book shows a credit balance of $11,200. The difference is due to unpresented cheques of $3,000 and an uncleared lodgement. What is the value of the uncleared lodgement?
Section A
Blockchain Logistics Ltd has a debit balance of $12,500 on its bank statement. However, the cash book shows a credit balance of $11,200. The difference is due to unpresented cheques of $3,000 and an uncleared lodgement. What is the value of the uncleared lodgement?
Answer options:
A.
$1,700
B.
$4,300
C.
$1,300
D.
$14,200
How to approach this question
Use the bank reconciliation formula: Bank Statement Balance + Uncleared Lodgements - Unpresented Cheques = Cash Book Balance. Note that a debit balance on a bank statement means overdrawn (negative), and a credit balance in the cash book also means overdrawn (negative).
Full Answer
B.$4,300✓ Correct
Bank statement balance (overdrawn) = -$12,500. Cash book balance (overdrawn) = -$11,200. The reconciliation formula is: Bank Statement + Uncleared Lodgements - Unpresented Cheques = Cash Book.
-$12,500 + Lodgements - $3,000 = -$11,200.
Lodgements - $15,500 = -$11,200.
Lodgements = $15,500 - $11,200 = $4,300.
Common mistakes
Treating the debit balance on the bank statement as a positive asset, or the credit balance in the cash book as a positive asset.
Practice the full ACCA FA — Financial Accounting Practice Exam 6
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