End of month. You generate the Bank Account statement from your ledger, it says ₦15,000. Your bank emails you their statement, it says ₦14,650. ₦350 gap. Reconciliation is the routine practice of explaining every penny of that gap. The gaps fall into three buckets: bank charges you missed (book them), deposits in transit (no entry, bank will catch up), outstanding checks (no entry, bank will catch up). This lesson focuses on the first bucket, the one that needs adjusting entries. Apply the setup, then post the adjustments to bring your books in line with the bank.