module 12 - fabm2 q4

• Bank statement

  A document furnished by the bank to the depositor at the end of every month, showing the movement of the account including withdrawals, deposits and balance
• Bank statement


  • Contains all the withdrawals, deposits and balance of your account after every transaction
  • Indicates bank charges that were deducted by the bank automatically
  • Reflects interest earned by the account
• Date column


  Indicates the date the transaction was made
• Check number


  Details of the check paid by the bank
• Transaction code


  Bank code for the transactions
• Debit column

  Represents all charges or deduction made by the bank to your account
• Credit column


  Represents the deposits or additions to your account that was made by the bank
• Balance column


  The running balance after considering the effect of the transaction to your account
• Debit transactions


  • Bank service charge - monthly fee charged by the bank for its services
  • NSF (Not Sufficient Fund) - Banks use a debit memorandum when a deposited check from a customer "bounces" because of insufficient funds
• Credit transactions


  • Collection of cash proceeds from notes receivables
  • Interest income earned by the deposit
• Bank reconciliation


  The process of comparing the bank statement received from the bank with the accounting records of the business
• Together with the bank statements, the banks will include the copies of checks cleared or paid by the bank for that particular month
• Cross check


  A check that is marked to specify an instruction about the way it is to be redeemed, usually by writing two parallel lines on the upper left portion to indicate it must be deposited directly into an account of the payee
• Stale check


  A cheque which a bank will not accept and exchange for money or payment because it was written more than a certain number of months ago (in the Philippines, over 6 months)