What is the major purpose of a bank reconciliation statement?

1 answer:

3 0

Purpose of a bank reconciliation statement.
A bank reconciliation statement is used to compare your record to those of your bank to see if there is difference between the two sets of records. The ending balance of your version of cash records is known as the book balance while the bank`s version is known as bank balance. It is common for there to be a difference in the two balances. The results to the differences might be due to overdrawn bank account, bounced checks and overdraft fees. It is important for you to check the difference because there might be substantial variance between the amount you think you have and that the bank thinks you have. In some cases the bank may even elect to close down your account.

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Last month Peggy Company had a $42,028 profit on sales of $331,200. Fixed costs are $83,828 a month. What sales revenue is neede

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Answer:

Break-even Sales revenue =$220,600

Explanation:

Breakeven point is the level of activity that equates the total cost to the total revenue.

At the break-even point the business makes no profit and no loss.

Break-even point = Total fixed cost for the period / Contribution margin ratio

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= (125,856.00 /331, 200) × 100

= 38%

Break-even sales revenue = $83,828/0.38

=$220,600

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