When the passbook balance is taken as the starting point items which makes the passbook balance ...than the balance in the cash book must be deducted for the purpose of reconciliation.
higher
Explanation
When preparing a Bank Reconciliation Statement starting with the passbook balance, the treatment of items is reversed compared to starting with the cash book balance. Items that cause the passbook balance to be higher than the cash book balance must be deducted to arrive at the reconciled cash book balance. This is because these items have been recorded in the passbook but not yet in the cash book, inflating the passbook balance relative to the cash book.
Solution Steps
Step 1: Identify that passbook balance is the starting point for reconciliation.
Step 2: Understand that to arrive at the cash book balance, items making passbook balance higher must be reduced.
Step 3: Therefore, items making passbook balance 'higher' than cash book must be deducted.