when performing a reconciliation between the bank statement and the cash book, which TWO of the...

when performing a reconciliation between the bank statement and the cash book, which TWO of the following would require an entry in the cash book?

a. Deposits credited after date

b. Direct debit on bank statement only

c. Bank charges

d. Bank error

Solutions

Expert Solution

Following would require an entry in cash book:

b. Direct debit on bank statement only- Direct Debit is an instruction to the bank to transfer funds to another account on a recurring basis, such transaction has to be recorded in cash book.

c. Bank charges-Bank charges are charged directly to the customer account thereby reducing the bank balance shown in the bank statement, such transaction has to be recorded in cash book.

Following would not require an entry in cash book:

a. Deposits credited after date-It refers to a company's receipts ( cash/cheques from customers) which have been recorded by the company in cash book, but the amount will appear on its bank statement at a later date.

d. Bank error-A bank error is defined as an incorrect debit or credit on the bank statement of a check or receipt that the banking institution may correct at a later date, hence no adjustment in cash book required.

ekkarill92 answered 1 year ago

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