COMMERCE 1AA3 Lecture Notes - Lecture 11: Non-Sufficient Funds, Bank Reconciliation, Accounts Receivable
17 Oct 2016
School
Department
Course
Professor
Document Summary
Separation of duties ( asset handling, record keeping, transaction approval) Cash is the most susceptible asset to theft and fraud. Cash balance in the books is rarely equal to the cash balance - bank reconciliation identifies the reason. Deposits in transit - money that has been deposited but not processed. Outstanding cheques - amount is on cheque, but has not been cashed. Bank charges - services fees for banking. Bank credits - money from bank, due from error in deposit, or interest, loans borrowed, Bank or depositor errors - could be done by bank or company, can appear in company adjustment, or bank adjustment. Nsf ( non-sufficient funds ) - a bounced cheque received. The bank will charge the company a fee. Add: amounts collected by bank on behalf of company. Add : deposits not recorded by the bank. Any adjustments on the books must be adjusted in the books by using adjusting entries.
