Asked by Analise Johnson on Jun 16, 2024
Verified
A check for $342 was erroneously charged by the bank as $432. In order for the bank reconciliation to balance, you must add $90 to the bank statement balance.
Bank Reconciliation
The process of matching the balances in an entity's accounting records for a cash account to the corresponding information on a bank statement, to ensure accuracy and completeness of the records.
Erroneously Charged
Incorrectly or mistakenly billed for goods or services, leading to inaccurate financial transactions.
Bank Statement Balance
The ending cash balance as recorded in the bank's records at the end of a reporting period.
- Gain insight into the mechanism and value of bank reconciliation as it pertains to financial accounting.
- Comprehend the corrections and adjustments made during bank reconciliation.
Verified Answer
FS
Fernando SantosJun 16, 2024
Final Answer :
True
Explanation :
The bank statement balance needs to be decreased by $90 (since the actual amount of the check was $342, not $432) in order to balance with the company's records. So, you would subtract $90 from the bank statement balance, not add it.
Learning Objectives
- Gain insight into the mechanism and value of bank reconciliation as it pertains to financial accounting.
- Comprehend the corrections and adjustments made during bank reconciliation.