Definition of Journal Entries in a Bank Reconciliation
Journal entries are required in a bank reconciliation when there are adjustments to the balance per books. These adjustments result from items appearing on the bank statement that have not been recorded in the company’s general ledger accounts.
Examples of Journal Entries in a Bank Reconciliation
Common adjustments to the balance per books include:
See Also
What Does Ledger Balance Mean?Cash Deposit JECreating a Bank LedgerWhat is the journal entry for cash withdrawn from bank?- Bank fees or service charges for maintaining the account, fees for returned checks, processing wire transfers, check printing, etc.
- Bank interest earned
- Loan payments
- Electronic charges or remittances from suppliers and others
- Customer’s checks that were deposited but are now being returned because of insufficient funds
The journal entries for the bank fees would debit Bank Service Charges and credit Cash.
See Also
Banking in TallyPrimeThe journal entry for a customer’s check that was returned due to insufficient funds will debit Accounts Receivable and will credit Cash.
Interest earned by the company will be recorded with a debit to Cash and a credit to Interest Income.
