Module 9About 8 minFree lesson

Recording book adjustments

Objective: Record exactly the adjusting entries a reconciliation requires.

Recommended first: Bank reconciliation basics

Each book-side item becomes an adjusting entry, dated at the reconciliation date. Book errors are corrected for the difference only. After posting, the Cash account equals the adjusted balance.

Each adjusting entry from a reconciliation should be dated at the statement date and reference the reconciliation. For a book error, compute the difference between what cleared and what was recorded, then record just that difference. After posting, run the Cash ledger to confirm it equals the adjusted balance.

Check your work

Is each adjustment a book-side item?
Does the Cash ledger now equal the adjusted balance?
Was a book error corrected for the difference only?

Worked example: Book error

A $54 utility check was recorded as $45. Books are overstated by $9.

Journal entry for the worked example
Account	Debit	Credit
Utilities Expense	$9.00
Cash		$9.00

Common mistakes

✗ Adjusting the bank balance for an NSF check.
✓ The bank already deducted it; adjust the books.

Guided practice

Use hints freely here.

Item 1 of 1

Prointermediate

Reconcile FixRight Appliance Repair's bank account

Reconcile the bank statement to the Cash account at month-end. Classify each unmatched item, compute the adjusted bank and book balances, and record only the adjusting entries the books need.

Checking answers on Pro items requires a Pro or Lifetime plan. See plans.

Bank statement balance (Mar 31, 2026)

$4,392.00

Cash account (books)

$5,520.00

1. Classify each unmatched item

In the books Deposit in night drop $1,150.00 ($1,150.00)
In the books Check #507 $100.00 outstanding (($100.00))
In the books Check #509 $140.00 outstanding (($140.00))
On bank statement Interest credited $17.00 ($17.00)
On bank statement Customer check returned NSF $235.00 (($235.00))

2. Adjusted balancesAdjusted bank balanceAdjusted book balance

3. Adjusting entries the books need

Record only book-side items. Leave this empty if no entries are needed.

Independent practice

Try these without hints. Completing the lesson needs at least one independent item solved without revealing the answer.

Item 1 of 2

Proadvanced

Reconcile Peak Form Fitness Studio's bank account

Reconcile the bank statement to the Cash account at month-end. Classify each unmatched item, compute the adjusted bank and book balances, and record only the adjusting entries the books need.

Checking answers on Pro items requires a Pro or Lifetime plan. See plans.

Bank statement balance (Mar 31, 2026)

$4,479.00

Cash account (books)

$5,170.00

1. Classify each unmatched item

On bank statement Utility check #344 cleared for $12.00 but was recorded in the books as $21.00 ($9.00)
In the books Deposit in transit $700.00 ($700.00)

2. Adjusted balancesAdjusted bank balanceAdjusted book balance

3. Adjusting entries the books need

Record only book-side items. Leave this empty if no entries are needed.

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References and provenance

OpenStax, Principles of Accounting, Volume 1: Financial Accounting (accessed 2026-10-29)

Original lesson written for Bookkeeping Exercises (AI-assisted drafting). Calculations are verified by the platform's automated accounting tests. Not yet reviewed by a credentialed accountant. Updated 2026-10-29.