BBA 1st Semester Bookkeeping Notes


Utility of Bank Reconciliation Statement

It given an authentic proof of the accuracy of the cash book and passbook balances.

  1. Entries in both the books are automatically checked.
  2. The cash book may be made up to date by recording some unknown entries.
  3. Error, if any, may be rectified.

Main Point Regarding Bank Reconciliation Statement

  1. The bank reconciliation statement is prepared by the customer.
  2. Bank reconciliation statement may be prepared at any time.
  3. Bank reconciliation statement is prepared by taking the balance of cash book or passbook and in the end, the balance of passbook or cash book is calculated.
  4. The debit balance of the passbook shows unfavorable (overdraft) balance while the credit balance of pass book shows favorable balance.
  5. Debit balance of cash book shows, favorable balance while credit balance of cash book shows unfavourable (overdraft) balance.

Rectification of Errors (BBA Bookkeeping Notes)

In financial accounting, every single event occurring in monetary terms is recorded. Sometimes, it just so happens that some events are either not recorded or it is recorded in the wrong head of account or wrong figure is recorded in the correct head of account.

Whatever the reason may be, there is always a chance of error in the books of accounts. These errors in accounting require rectification. The procedure adopted to rectify errors in financial accounting is called “Rectification of Errors”.

BBA 1st Semester Bookkeeping Notes

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