What is a bank reconciliation... | Class 11 Accountancy Ch 5 | NCERT Long Answer 1

Class 11 Accountancy, Chapter 5: Bank Reconciliation Statement. NCERT Long Answer 1 (Questions for Practice): What is a bank reconciliation statement. Why is it prepared? Answer in one line A BRS is a statement that tallies the bank balance as per cash book with the passbook balance by showing items of difference. Key points Meaning: Prepared by the account holder to reconcile cash book bank balance with passbook or bank statement balance. Balances rarely tally: Both balances should agree, but in practice they usually differ, so causes must be found. Timing differences: E.g. cheques issued but not presented, cheques deposited but not yet collected by the bank. Bank's direct entries: Bank charges, interest, direct deposits, standing-order payments, dishonoured cheques appear first in passbook. Detects errors: It brings out errors made by the firm in the cash book or by the bank in the passbook. Updates records: It helps the firm update its cash book and find the correct bank balance. Key terms Bank Reconciliation Statement, Cash book, Passbook, Timing differences, Errors, Overdraft Exam tip Define BRS first, then state both causes of difference: timing differences and errors. Chapters 0:00 Intro 0:12 Question 0:18 Answer 0:31 Explanation 1:24 Recap Who is this for Class 11 Commerce (Accountancy) students of CBSE and state boards: revision before school exams, and a base for Class 12 and CUET Accountancy. Syllabus reference: NCERT Accountancy, Financial Accounting Part I, Chapter 5, Questions for Practice, Long Answer 1. The answer is explained in our own words from the chapter and checked against its text. The question is from the NCERT textbook (ncert.nic.in). #Class11Accountancy #NCERT #CBSE #Commerce #Accounts