What is the possible reason if the balance shown on an entitys bank statement less than the correct cash balance and neither the entity nor the bank has any errors?
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FAR EASTERN UNIVERSITY 1ST Preliminary Examination Fin ACT 1 Financial Acctg. Part I – Multiple Choice Theory 30% 1.To be reported as “cash and cash equivalent”, the cash item must be, (a) Unrestricted in use for current operation; (b) Available for the purchase of property, plant and equipment; (c) Set aside for the liquidation of long-term debt;
(d). Deposited in the bank. Answer: (a) 2. Which of the following shall not be considered cash for financial reporting purposes? (a) Petty cash fund and change fund; (b) Money orders, certified checks and personal checks; (c) Coins currency and available funds; (d) Postdated checks and IOU’s. Answer: (d) 3. If material, deposits in foreign bank which are subject to foreign exchange…show more content… Popular Essays
If the balance shown in the bank statement is less than the correct cash balance and neither the entity nor the bank has made any errors, there must be A. deposits credited by the bank but not yet recorded by the entity B. Deposits in transit C. Outstanding Checks D. Bank Charges not yet recorded by the entity Q: . I. Imprest should be used for small reimbursements and material expenses such as utilities or to… A: Solution: 1. False, Imprest should be used for small reimbursements but not for material expenses… Q: In the reconciliation of a bank statement, "deposits in transit" should be: a. added to the… A: A DEPOSITS IN TRANSIT IS A DEPOSIT THAT HAS BEEN SUBMITTED TO THE BANK BUT BANK HAS NOT RECORDED IT… Q: In the reconciliation of a bank statement, "deposits in transit" should be: a. added to the… A: Deposits in transit are the amount of cash that has been deposited by the business but has not been… Q: During a bank reconciliation process, Oa. outstanding checks and deposits in transit are subtracted… A: Bank Reconciliation Statement: Bank statement is prepared by bank. The company maintains its own… Q: Which of the following has incorrect treatment for the bank and book reconciling items assuming… A: The bank reconciliation statement is prepared to equate the balances of cash book and passbook with… Q: The explanation of the differences between the cash account balance according to the company’s book… A: The question is multiple choice question. Required Choose the Correct Option. Q: When an entity's bank account in the general ledger has a credit balance, this means that the entity… A: Normally all assets of the business have debit balance and all liabiliites have credit balance.… Q: On a ban reconcialiation, customer's checks that are returned for lack of funds would be a.… A: PLEASE LIKE THE ANSWER CORRECT ANSWER IS "a" i.e., deducted from the balance per company records Q: If a check correctly written and paid by the bank for $744 is incorrectly recorded on the company's… A: Bank reconciliation: It is a statement which is prepared to reconcile the balance as per cash book… Q: -Identify the external source of audit evidences to reconcile the imbalance in the cash book and… A: External source of audit evidences are collected by the auditor outside the client's organization. Q: Which of the following statements is false? a. Legally restricted bank deposits held as compensating… A: Cash and Cash Equivalents Here is related to the Cash and its Equivalents which are relation with… Q: Seldom does the balance of the cash in bank account in the depositor's books agree with the balance… A: Seldom does the balance of the cash in bank account in the depositor's books agree with the balance… Q: Which of the following is a bank account from which a company transfers funds from a master account… A: The banks require funds for the settlements of the accounts, cheques clearance, and other payments.… Q: he amount of the outstanding checks is included on the bank reconciliation as a(n) Select one: A.… A: >Outstanding checks are the checks that have been written and given to a party, but that party… Q: When preparing a bank reconciliation, if the adjusted book balance and the adjusted bank balance are… A: Equal amount of Adjusted book balance and the adjusted bank balance doesn't tell the cash is used… Q: Which of the following items would normally be EXCLUDED from the amount to be reported as cash on a… A: Statement of financial position is the one on which the company's assets and liabilities are… Q: Outstanding checks refer to checks that have been: Multiple Choice Written, recorded, sent to… A: Outstanding checks : These are the checks which are written and sent to the bank but which are not… Q: Which of the following will NOT require an adjusting entry when reconciling the bank statement? O… A: Bank reconciliation is a statement prepared to match bank account balance as per cash book and bank… Q: A check returned by the bank marked "NSF" means Select one: a. not satisfactorily filled-out. b. not… A: The bank reconciliation statement is prepared to adjust the balances of cash book and passbook with… Q: Identify which one of the following statement is not correct? a. The credit limit under the facility… A: A cash credit is a line of credit lent against the asset and liabilities, credit worthiness etc. The… Q: Preparing the bank recociliation is consifered to be an important step in interna; control process… A: Bank reconciliation refers to the process of reconciling the balances of the accounting records of… Q: Another way to describe account reconciliation is bank reconciliation—the process of bringing the… A: A bank reconciliation statement is prepared by almost every organization at a particular time. It is… Q: a.explain with figures why your company's cash book balance will not agree with the bank statement… A: Cash book is the book that will be prepared and maintained by the management of the company. All the… Q: When preparing a bank reconciliation, adjustments are made to the bank side and not the ledger… A: Bank reconciliation statement is prepared where an entry which is found in one book (Cash book or… Q: On receipt of bank statements, a company has identified that bank has collected interest OMR 100,… A: Bank reconciliation: It is a statement drawn up by the business to verify the cash book balance with… Q: Which of the following items appearing on a bank reconciliation require a journal entry to bring the… A: Bank reconciliation statement is a statement which is prepared to reconcile cash balance as per cash… Q: A bank reconciliation statement is a statements that is Drawn up by the business to verify the cash… A: Bank reconciliation: It is a statement drawn up by the business to verify the cash book balance with… Q: The bank balance in the cash book and that of the bank statement may disgrace because of… A: Bank Reconciliation Statement is a statement is prepared to correct the balance between cash balance… Q: The bank balance in the cash book and that of the bank statement may disgrace because of… A: Bank Reconcilation Statement The statement reconciling bank book and bank statement is called Bank… Q: The bank balance in the cash book and that of the bank statement may disgrace because of… A: Bank balance in cash book means balance shown in books of the company as cash balance. Bank… Q: The bank balance in the cash book and that of the bank statement may disgrace because of… A: Since two copies are never identical, two record keeping accounts can never be the same. There lie… Q: The bank balance in the cash book and that of the bank statement may disgrace because of… A: Bank reconciliation statement prepares to analyze the cause of difference between cash book and bank… Q: The bank balance in the cash book and that of the bank statement may disgrace because of… A: The above statement is absolutely true. The bank balance in the cash book and that of the bank… Q: On a bank reconciliation, the amount of an unrecorded bank service charge should be: Multiple Choice… A: The bank reconciliation statement is prepared to equate the balances of cash book and passbook with… Q: k charged a check against the company that should ner company add to cash balance per bank True A: Bank Reconciliation statement reconciles the cash balance of the company records with the bank… Q: Technically, a bank can require depositors to give prior notice before they withdraw funds from time… A: Time deposits are deposits in the a bank which has fixed time of maturity. For this deposits,… Q: Which of the following reconciling items may not result from bank side reccords of a bank account? A: The financial statement which records the amount differences between bank statement and bank account… Q: Match definitions with vocabulary terms) Use theseterms to complete the statements that follow. You… A: Bank Reconciliation Statement: Bank statement is prepared by bank. The company maintains its own… Q: If a check correctly written and paid by the bank for $428 is incorrectly recorded on the company's… A: What is meant by a Bank Reconciliation Statement? The main purpose of preparing this statement is to… Q: Which of the following statements is true? A certified check should be included in the outstanding… A: Certified check means the check issued by bank saying that there is sufficient funds available in… Q: What is “Deposit in transit” in bank reconciliation? Select one: A. Subtracted From the Cash… A: Click to see the answer Knowledge Booster Learn more about Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you College Accounting (Book Only): A Career Approach ISBN:9781337280570 Author:Scott, Cathy J. Publisher:South-Western College Pub Cornerstones of Financial Accounting ISBN:9781337690881 Author:Jay Rich, Jeff Jones Publisher:Cengage Learning Financial Accounting ISBN:9781337272124 Author:Carl Warren, James M. Reeve, Jonathan Duchac Publisher:Cengage Learning College Accounting, Chapters 1-27 ISBN:9781337794756 Author:HEINTZ, James A. Publisher:Cengage Learning, Auditing: A Risk Based-Approach (MindTap Course L... ISBN:9781337619455 Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg Publisher:Cengage Learning Principles of Accounting Volume 1 ISBN:9781947172685 Author:OpenStax Publisher:OpenStax College College Accounting (Book Only): A Career Approach ISBN:9781337280570 Author:Scott, Cathy J. Publisher:South-Western College Pub Cornerstones of Financial Accounting ISBN:9781337690881 Author:Jay Rich, Jeff Jones Publisher:Cengage Learning Financial Accounting ISBN:9781337272124 Author:Carl Warren, James M. Reeve, Jonathan Duchac Publisher:Cengage Learning College Accounting, Chapters 1-27 ISBN:9781337794756 Author:HEINTZ, James A. Publisher:Cengage Learning, Auditing: A Risk Based-Approach (MindTap Course L... ISBN:9781337619455 Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg Publisher:Cengage Learning Principles of Accounting Volume 1 ISBN:9781947172685 Author:OpenStax Publisher:OpenStax College What are some reasons that a bank statement might not match a cash balance of a business's records?Reasons a Bank Balance Will Differ from a Company's Balance. Outstanding checks.. Deposits in transit.. Bank service charges and check printing charges.. Errors on the company's books.. Electronic charges and deposits that appear on the bank statement but are not yet recorded in the company's records.. What are some reasons that cause the balance on the bank statement to differ from the cash balance on the books?Reasons why the bank balance differs from the book balance. Outstanding checks. The company has issued checks that have not yet been presented to the bank for payment. ... . Deposits in transit. ... . Interest on deposited cash. ... . Bank service fees. ... . Check printing charges. ... . Bank error. ... . Company error.. What would cause the balance of cash in the bank statement not to equal the balance of cash in the accounting records?Which of the following items would cause the balance of cash in the bank statement not to equal the balance of cash in the accounting records? Cash receipts by the company that have not been deposited in the bank.
What would cause the bank statement balance to be less than the adjusted cash balance in the general ledger?Deposits in transit.
These deposits are called deposits in transit and cause the bank statement balance to understate the company's actual cash balance.
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