When given 2 bank reconciliation statements, how do I know whether the first bank rec. has an overdraft or not.? (no amount given for bal. except the opening for the following months bank rec.)?
submitted by apenisa

Frank Smith

You've got to compare the adjusted bank balance with the ledger balance. If the adjusted bank balance is negative or if the reconciliation notes explicitly mention an overdraft, then the account was overdrawn at that point.

Since only the opening balance for the subsequent month is provided, you should look at the closing balance of the first reconciliation. If that's a negative, or it's marked as an overdraft, then the first bank rec shows an overdraft.

Jims

Basically, you look at the ending balance in the first bank reconciliation. If it's a negative number or if they say it's an overdraft, then the account was overdrawn. Check what the first reconciliation shows at the end. If it's below zero, you've got yourself an overdraft.