Isurance premium paid but not entered in cash book is Rs. 2,500

Wrong credit in.the cash book of bank column is Rs 5,000.

Online payment no recorded in cash book is Rs 1,000

Wrong credit in cash book is Rs.1,000
Instead of personal bank account he can open business bank account (i.e.) current account

It means balance lying with the bank or the deposits made by the firm are more than its withdrawals.

It means overdraft ie., amount due to the bank or the excess amount withdrawn over the amount deposited in the bank.

The values involved in the preparation of bank reconciliation statement are
(i) Prevention of fraud
(ii) Identifying errors
(iii) Fulfilment of commitment on time by finding out reasons of undue delay in clearance of cheque

Causes of disagreement between the balances shown by the cash book and bank statement.
(i) Cheques issued but not yet presented for payment.
(ii) Cheques paid into bank for collection but not yet collected.

(i) If entry in the cash book matches with the bank statement, then bank balance will be the same in both the records.
(ii) But, practically it may not be possible. When the balances do not agree with each other, the need for preparing a statement to explain the causes arises. This statement is called bank reconciliation statement (BRS).

(i) Bank overdraft is an amount drawn over and above the actual balance kept in the bank account.
(ii) This facility is available only to the current account holders.
(iii) Interest will be charged for the amount overdrawn i.e., overdraft.