Finance Questions

A Bank Reconciliation Statement is a statement prepared periodically by a customer to explain the divergence (difference) between the bank balance as per cash book and the bank balance as per Pass Book. It clearly shows the two differing balances and the outstanding items which causes the balances to disagree.

The objective of preparing such a statement is to know the causes of differences between the two balances and pass necessary correcting or adjusting entries in the books of the firm. But it is to be noted that some differences are automatically adjusted. For example - A cheque that has been sent for collection, but not yet collected, causes a difference between the balance as shown by the pass book and the balance as shown by the cash book, but no adjusting entry is required in the cash book for such a difference because, the bank will credit the firm’s account as soon as the cheque is collected.

The grace period is in which time period students are not to be worried to repay the loans in that period.

 The primary reason to issue stock is to raise money to start and maintain an ongoing business.

Other Reasons::

The reasons that a company might want to raise money by issuing stock are:

• To develop new products

• To buy more advanced equipment

• To pay for new buildings and inventories

• To hire more employees

• To provide for a merger or acquisition

• To decrease debt

• To give company owners greater flexibility

• To place a value on the company.