Question

True or False. All items shown on the bank reconciliation as adjustments of the book (ledger)...

True or False.

All items shown on the bank reconciliation as adjustments of
the book (ledger) balance require journal entries to adjust the Cash account,
whereas items appearing as adjustments to the balance per bank statement
do not require entries by the depositor.

please explain the answer

Business   Accounting   
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Homework Answers

Answer #1

True

In bank reconciliation is a statement that made to find differences between the balance in bank statement and balance in their accounting records. Usually, the balance on the monthly bank statement does not agree with the depositor’s accounting record, the reasons are some charges with is charged by the bank are not recorded in the books and some interest earned not recorded and directly received collection to the bank not recorded, because of these reasons depositors' make journal entries to adjust the Cash account and cheque issued, deposits outstanding which are not reflected in bank statement which are already recorded in the books so depositors' do not make journal entries to adjust the Cash account.

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