be deducted from the bank debits total to

CHAPTER 9: arrive at the checks paid by bank.

TWO-DATE BANK
RECONCILIATION
PROOF OF CASH
Bank recon involving two dates; occurs only
when certain facts are omitted, hence the Expanded reconciliation with proof of receipts &
necessity for computing them disbursement to discover discrepancies in
handling cash
Reconciliation statements – prepared if all
facts are available FORMS OF PROOF OF CASH
Among others, the omitted information may be
1. Adjusted balance method – book
any one or a combination of the following:
receipts/disbursements, and the bank
receipts/disbursements are adjusted to equal
the correct receipts/disbursements for the
1. BOOK BALANCE current month.
Book debits – cash receipts or all items 2. Book to bank method – book
debited to cash in bank receipts/disbursements are adjusted to equal
the bank receipts/disbursements
Book credit – cash disbursements or all items
credited to cash in bank 3. Bank to book method - bank
receipts/disbursements are adjusted to equal
the book receipts/disbursements.
2. BANK BALANCE
Bank credits – all items credited to the
account of depositor (e.g. deposits
acknowledge by bank and credit memos)
Bank debits – all items debited to the account
of the depositor (e.g. checks paid by bank and
debit memos)

3. DEPOSITS IN TRANSIT
All items debited to the cash in bank account
which do not represent deposits should be
deducted from the book debits to arrive at the
cash receipts deposit.
All items credited to the depositor’s account
which do not represent deposits should be
deducted from the bank credits to determine
the deposits acknowledged by bank.

4. OUTSTANDING CHECKS
All items not representing checks credited to
the cash in bank account should be deducted
from the book credits total to arrive at the
checks drawn by the depositor.
All items debited to the account of the
depositor not representing checks paid should