BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Choclate Chews Company gathered the following reconciling information in preparing its August bank reconciliation:Cash balance per books, 8/31 $15, 900Deposits in transit 900Notes receivable and interest collected by bank 8, 400Bank charge for check printing 120Outstanding checks 12, 000NSF check 1, 200The adjusted cash balance per books on August 31 is
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$10, 980.
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$11, 880.
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$22, 980.
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$23, 880.
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Explanation:
Detailed explanation-1: -Answer and Explanation: Option C is correct. Deposits in transit would be added to the balance per bank statement in a bank reconciliation.
Detailed explanation-2: -Explanation: Service charges would be deducted from the balance per books on a bank reconciliation.
Detailed explanation-3: -Example of Outstanding Checks When the company prepares a bank reconciliation, the outstanding checks are subtracted from the bank statement balance in order to determine the correct or adjusted bank balance.
Detailed explanation-4: -So, when preparing a bank reconciliation if balance as per bank statement is the starting point then, deposits in transit and cheques not collected would have to be added.
There is 1 question to complete.