Additions to Bank's Records
TA reminder...
We need to look at the previous bank reconciliation statement (Exhibit 4) as part of our records too since we are likely to have late deposits that will be added to the bank's records early in the month. For example, we had a deposit of $435.55 that was not yet on our bank statement, and it was credited to our bank account on April 1, 2005. If the bank had not credited our account, you would need to do two things:
- re-add the deposit again to the records (this is a cash item that you know about that the bank does not), and
- get talking to your account manager at the bank, along with the person who makes your deposits, to find out where the $435.55 went.
As you go through the old bank reconciliation statement and your cash receipts/disbursements lists, you should find one item that increases your cash balance and appears in our records but is not reflected on the bank statement.
Item #1 - Deposit in Transit
In Exhibit 3, there is a late bank deposit dated April 30 for $300.55 that has not yet been added to our bank balance (It is highlighted in yellow above.). We know about this, but the bank does not; therefore, we add it to the bank's balance. We record it on the reconciliation as:
