Bank Reconciliation Statement (BRS) is a statement that reconciles the balance as per bank passbook and balance as per company's accounting records. It helps in identifying the discrepancies and errors between the two balances. Here, we will discuss a transaction where the bank has directly paid ₹1250 for rent as per standing instructions.

Pass Book Overdraft

Pass Book Overdraft is a situation in which the balance as per passbook shows a negative balance, indicating that the bank has paid more than the available balance. In such cases, the company has to pay interest on the overdrawn amount.

Transaction Analysis

In this case, the bank has directly paid ₹1250 for rent as per standing instructions. This transaction will appear in the passbook, but not in the company's accounting records. Therefore, it will create a difference between the two balances.

BRS Analysis

To reconcile the difference, we will add the rent paid by the bank to the company's accounting records. This will increase the accounting balance by ₹1250. As a result, the difference between the two balances will decrease by the same amount.

Conclusion

In conclusion, the bank has directly paid ₹1250 for rent as per standing instructions, which will create a difference between the balance as per passbook and balance as per company's accounting records. To reconcile this difference, we will add the rent paid by the bank to the accounting records. This will decrease the difference between the two balances.

We will less the brs by 1250