Odd Reconciliation Question

[Michael Hendry]

On 5 Feb 2014, at 01:30, Mark Phillips <mark at phillipsmarketing.biz> wrote:

> I was reconciling my checking account, and ran into this problem. I wrote a
> check for $795.50, but the bank only paid $795.00. I looked at the image of
> the check, and it clearly shows $795.50, but the statement says the bank
> only took $795.00.
> 
> * I could just edit the amount of the check to $795.00 and keep reconciling.
> 
> * Should I put that $0.50 into some sort of A/P account and wait to see if
> the recipient of the check figures it out?

I am not an accountant, but…

Your check was written to pay for goods or services, and the relevant Expense account should reflect the full $795.50 which you owed.

Your bank failed to pay the $0.50, but you are still liable to pay this amount.

I’d create a new Current Liability account - let’s say it’s called “Underpayment by Bank” - and edit the transaction which records your check so that $795.00 comes from your bank and $0.50 comes from Underpayment by Bank.

You can then reconcile the bank account, and once the bank discovers its mistake and charges you the $0.50 you can record this transaction as a payment from your checking account to Underpayment by Bank and reconcile this too.

There are no doubt other ways you might handle this, but I think this would make it clear to anyone looking at your accounts what has actually gone on.

Michael

> 
> Thanks!
> 
> Mark
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