Fundamentals of Accountancy

Learning Area Grade Level

Q2
12
Business and Management 2
Sem/Quarter 1st Sem- 2nd Quarter Date November 30-Dec.1, 2023

W4
I. LESSON TITLE Bank Reconciliation Statement
II. MOST ESSENTIAL LEARNING • describe the nature of a bank reconciliation statement,
COMPETENCIES (MELCs) ABM_FABM12-IId-10
• identify common reconciling items and describe each of them,
ABM_FABM12-IId-11
• analyze the effects of the identified reconciling items,
ABM_FABM12-IId-12
III. CONTENT/CORE CONTENT Bank Reconciliation Statement
IV. LEARNING PHASES AND ACTIVITIES
I. LEARNING OBJECTIVES:
1. Illustrate bank statement
2. Discuss each part of the bank statement
3. Show self-reliance when working independently

Introduction

A bank reconciliation statement is a report that is prepared for the purpose of bringing the balances of cash (a) per records and (b) per
bank statement into agreement.

Pro forma bank reconciliation:

Bal. per books, end xx Bal. per bank, end xx

Add: CM xx Add: DIT xx
Less: DM (xx) Less: OC (xx)
+/-: Book errors xx +/-: Bank errors xx
Adjusted Balance xx Adjusted Balance xx

• Credit Memo (CM) – are additions (bank credits) made by the bank to the depositor’s bank account but not yet recorded by the
depositor, e.g. collections made by the bank on behalf of the of the depositor.
• Debit Memo (DM) – are deductions (bank debits) made by the bank to the depositor, e.g. NSF checks, bank service charges.
• Deposit in transit (DIT) – are deposits made but not yet credited by the bank to the depositor’s bank account.
• Outstanding checks (OC) – are checks drawn and released to payees but are not et encashed with the bank.

BOOK ERROS
Nature of error Effect on ending balance of cash Correction
a. Undertstatement in book debit Understatement (kulang) Debit (addition) on the pro forma
(kulang sa pagdagdag) reconciliation (magdagdag)
b. Understatement in book credit Overstatement (sobra) Credit (deduction on the pro forma
(kulang sa pagbawas) reconciliation) (magbawas)
c. Overstatement in book debit Overstatement (sobra) Credit (deduction on the pro forma
(sobra sa pagdagdag) reconciliation (magbawas)
d. Overstatement in book credit Understatement (kulang) Debit (addition) on the pro forma
(sobra sa pagbawas) reconciliation (magdagdag)

1
 BANK ERRORS
Nature of error Effect on ending balance of cash Correction
a. Undertstatement in bank credit Understatement (kulang) Credit (addition) on the pro forma
(kulang sa pagdagdag) reconciliation (magdagdag)
b. Understatement in bank debit Overstatement (sobra) Debit (deduction on the pro forma
(kulang sa pagbawas) reconciliation) (magbawas)
c. Overstatement in bank credit Overstatement (sobra) Debit (deduction on the pro forma
(sobra sa pagdagdag) reconciliation (magbawas)
d. Overstatement in bank debit Understatement (kulang) Credits (addition) on the pro forma
(sobra sa pagbawas) reconciliation (magdagdag)

Learning Activity Sheet Quarter 2-Week 2

Bank Reconciliation

Name: Score:
Grade Level & Section: Subject Teacher:

Problem 1: Entity A is preparing its bank reconciliation for the month ended September 30, 2023. The following information was determined:
• Cash balance per books, Sept 30 – P620,000
• Cash balance per bank statement, Sept 30 – P870,000
• Credit Memo – P430,000
• Debit Memo – P20,000
• Deposits in transit – P460,000
• Outstanding Checks – P120,000
• The bank erroneously credited the account of Entity A for P180,000.

Problem 2: Entity B is preparing its bank reconciliation for the month ended August, 31, 2023. The following was determined
• Cash balance per books, Aug. 31 – P460,000
• Cash balance per bank statement, Aug. 31 – 520,000
• Credit memo – P290,000
• Debit memo - P310,000
• Deposits in transit – P150,000
• Outstanding checks – P320,000
• Entity B erroneously recorded as P120,000 collection of an account receivable as P210,000.

Problem 3: The accounting records and bank statement of Entity A show the following information

SUBSIDIARY LEDGER
CASH IN BANK – BPI CURRENT ACCOUNT
Date Description Debit Credit Balance
6/1 Bal. forwarded 881,000
6/11 Check #1113 130,800 750,200
6/15 Check #1114 220,000 530,200
6/16 Deposit 295,800 826,000
6/22 Deposit 670,000 1,496,000
6/24 Check #1115 80,000 1,416,000
6/28 Check #1116 380,000 1,036,000
6/29 Deposit 160,000 1,196,000

METROBANK
BANK STATEMENT – ENTITY A
Date Description Debit Credit Balance
6/1 Bal. forwarded 881,000
6/10 Deposit 350,000 1,231,000
6/15 Payment 2,000 1,229,000
6/15 Check #1114 220,000 1,009,000
6/16 Deposit 295,800 1,304,800
6/20 Payment 50,000 1,254,800
6/22 Deposit 670,000 1,924,800
6/24 Check #1115 80,000 1,844,800
6/26 Check #1113 130,800 1,714,000
6/28 Deposit 410,000 2,124,000

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 Additional information
• The payments of P2,000 and P50,000 shown on the bank statement pertain to the cost of checkbook requested from the bank and the monthly
amortization of a bank loan, respectively. The loan payment for interest of P8,000.
• Deposits shown on the bank statement but not on the cash ledger represent collections of accounts receivable.
Requirements:
a. Prepare the bank reconciliation
b. Prepare the reconciling items

REFLECTION

In a separate sheet, write your personal insights about the lesson using the prompts below.

I understand that
_____________________________________________________________________________________________________________________
_________________________________________________________________

I realize that ________________________________________________________________________________________________

_________________________________________________________________________________________________________

I need to learn more about ______________________________________________________________________________________________

Parent’s Signature:

Date Returned/Submitted:

Prepared by: Analyn C. Rubio Teacher’s Comment:

Evaluated by: Lynett Fegarido/Oliver C. Sta. Maria

Reviewed by: Cel Andrea B. Bodota

Subject Group Head, ABM Dept.