Answer to Question #266333 in Accounting for nicole

Question

Directions: Answer the questions which follow.

1.A bank reconciliation is

A. a formal statement that lists all of the bank account balances of an entity.

B. a merger of two banks that previously were competitors.

C. a statement sent by the bank to depositor on a monthly basis.

D. a schedule that accounts for the differences between an entity’s cash balance as shown on its bank statement and the cash balance shown in its general ledger.

2.Provide 1-2 sentence/s to explain your answer in item number 1.

3.Which of the following items must be added to the cash balance per ledger in preparing a bank reconciliation which ends with adjusted cash balance?

A. note receivable collected by the bank in favor of depositor and credited to the account of the depositor

B. NSF customer check

C. service charge

D. erroneous bank debit

4.Provide 1-2 sentence/s to explain your answer in item number 3.

Answer 1

Solution:

1.). The correct answer is D. a schedule that accounts for the differences between an entity’s cash balance as shown on its bank statement and the cash balance shown in its general ledger.

 

2.). A bank reconciliation statement summarizes banking and business activity by reconciling a company's bank account to its financial records. Bank reconciliation statements confirm that payments have been processed and cash collections deposited into a bank account.

 

3.). The correct answer is A. note receivable collected by the bank in favor of depositor and credited to the account of the depositor.

4.). A note receivable collected by the bank must be added to the cash balance per ledger, which must be collected by the bank and be in favor of the depositor, as well as credited to the depositor's account.