Bank reconciliation Statement in case of overdraft
Bank reconciliation Statement in case of overdraft: --
Preparation of the Bank
Reconciliation Statement
Take the cash book or the pass book balance and then see what has been done or not been done in the other book.
Thus if we start from the pass book balance, we must see what has been or not been done in the cash book. Then work out the balance as if the entries passed in the cash book had also been passed in the pass book and the entries not passed in the cash book had also been removed from the pass book.
If we start from the cash book, we should follow the pass book entries.
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