Question 1

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?

Accepted Answer

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).

Question 2

What mistakes do candidates make on this ACCA question?

Accepted Answer

Treating the debit balance on the bank statement as a positive asset, or the credit balance in the cash book as a positive asset.

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?

How to approach this question

Full Answer

Common mistakes

Practice the full ACCA FA — Financial Accounting Practice Exam 6

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