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Bank Statement Reconciliation: Comparing Check Register with Statement

Learn how to reconcile your bank statement by comparing your check register with the statement, ensuring they agree. Discover the formula for calculating the adjusted balance and find out what documents you need for reconciliation.

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Bank Statement Reconciliation: Comparing Check Register with Statement

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  1. SECTION 4-5 Reconciling the Bank Statement pp. 178-181

  2. Reconcile: a check register with a bank account statement Section Objective

  3. Key Words to Know reconcile (p. 178) To compare your check register with the bank statement of your checking account to make sure they agree.

  4. Formula Adjusted = Statement – Outstanding Checks/ + Outstanding Balance Balance Payments or Debits Deposits

  5. Fleet Footed Finances p. 178 What documents are needed to reconcile your monthly bank statement?

  6. Example 1 Your statement balance is $598.67. You have an outstanding check for $125.44 and an outstanding debit of $235.42 that didn’t post yet. You also have an outstanding deposit of $231.98. What is your adjusted balance?

  7. Example 1 Answer Step: Calculate the adjusted balance. Statement = Outstanding Checks/ + Outstanding Balance Payments or Debits Deposits $598.67 – ($125.44 + $235.42) + $231.98 $598.67 – $360.86 + $231.98 = $469.79

  8. Example 2 Margaret Miller’s check register balance is $2,261.50. She compares her statement and check register. For each check and deposit listed on her statement, she places a check mark next to the information in her register. She notes that the bank paid her $0.86 in interest.

  9. Example 2 (cont.) Miller finds these outstanding checks and deposits. Check #525 $341.50 Check #527 $266.25 Deposit $709.75 How does Miller reconcile her statement?

  10. Example 2 Answer Step: Reconcile the balance. Miller uses the reconciliation form on the back of her statement to reconcile her account.

  11. Figure 4.11

  12. Practice 1 Find the adjusted balance. Statement Balance: $1,708.43 Outstanding Checks: $185.29 Outstanding Deposits: $263.04

  13. Practice 1 Answer $1,786.18

  14. Practice 2 Fill in the missing amount. Then determine whether the register and statement balances agree. Check Register Balance: $717.16 Interest: $1.20 Service Charge/Fees: $0 New Balance:

  15. Practice 2 (cont.) Statement Balance: $854.07 Outstanding Checks: $197.46 Outstanding Deposits: $61.75 Adjusted Balance: Do the register and statement balances agree?

  16. Practice 2 Answer Check Register Balance: $717.16 Interest: $1.20 Service Charge/Fees: $0 New Balance: $718.36

  17. Practice 2 Answer (cont.) Statement Balance $854.07 Outstanding Checks $197.46 Outstanding Deposits $61.75 Adjusted Balance: $718.36 Do the register and statement balances agree? Yes

  18. END OF SECTION 4-5 Reconciling the Bank Statement

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