Asked by Carlos Murray on May 08, 2024
Verified
In preparing a bank reconciliation, outstanding cheques are
A) added to the balance per bank.
B) deducted from the balance per books.
C) added to the balance per books.
D) deducted from the balance per bank.
Outstanding Cheques
Checks that have been written and recorded in the issuing company's ledger but have not yet been cashed or cleared by the bank.
Balance Per Bank
It represents the amount of money in a company’s bank account, according to the bank's records.
- Ascertain components requiring alterations in bank reconciliations and their effects on the financial statement balance and bank balance.
Verified Answer
AN
Ayesha NaseerMay 11, 2024
Final Answer :
D
Explanation :
Outstanding checks are checks that have been written and recorded in the company's cash account but have not yet been cleared by the bank. Therefore, they are deducted from the balance per bank to reconcile the bank's balance with the company's records.
Learning Objectives
- Ascertain components requiring alterations in bank reconciliations and their effects on the financial statement balance and bank balance.
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