Knowledge Check 01 Match the term and the definition. DEFINITION 1. Subtract outstanding checks from the bank balance. 2. Compute the adjusted bank balance. 3. Enter the bank statement balance from the bank statement. 4. Add any unrecorded deposits to the bank balance. 5. Compute the adjusted book balance. 6. Add any unrecorded interest earned to the book balance. 7. Enter the company's book balance from its accounting records. 8. Subtract bank fees from the book balance. TERM Step 1 Step 2 Step 3 Step 4 S
Knowledge Check 01 Match the term and the definition. DEFINITION 1. Subtract outstanding checks from the bank balance. 2. Compute the adjusted bank balance. 3. Enter the bank statement balance from the bank statement. 4. Add any unrecorded deposits to the bank balance. 5. Compute the adjusted book balance. 6. Add any unrecorded interest earned to the book balance. 7. Enter the company's book balance from its accounting records. 8. Subtract bank fees from the book balance. TERM Step 1 Step 2 Step 3 Step 4 S
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
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Ay
Required information
A bank reconciliation proves the accuracy of the depositor's and the bank's records. The bank statement balance is
adjusted for items such as outstanding checks and unrecorded deposits made on or before the bank statement date but
not reflected on the statement. The book balance is adjusted for items such as service charges, bank collections for the
depositor, and interest earned on the account.
Steps in Preparing Bank Reconciliation:
1. Enter bank balance taken from the bank statement.
2. Add unrecorded deposits and bank errors understating the bank
balance.
3. Subtract any outstanding checks and bank errors
overstating the bank balance from the bank balance.
4. Compute the adjusted bank balance.
5. Enter cash account book balance taken from the accounting
records.
6. Add any unrecorded cash receipts and errors understating the book
balance to the book balance.
7. Subtract any unrecorded bank fees, NSF checks, and errors
overstating the book balance and deduct them from the book balance.
Knowledge Check 01
D
Match the term and the definition"
Transcribed Image Text:8
Ay
Required information
A bank reconciliation proves the accuracy of the depositor's and the bank's records. The bank statement balance is
adjusted for items such as outstanding checks and unrecorded deposits made on or before the bank statement date but
not reflected on the statement. The book balance is adjusted for items such as service charges, bank collections for the
depositor, and interest earned on the account.
Steps in Preparing Bank Reconciliation:
1. Enter bank balance taken from the bank statement.
2. Add unrecorded deposits and bank errors understating the bank
balance.
3. Subtract any outstanding checks and bank errors
overstating the bank balance from the bank balance.
4. Compute the adjusted bank balance.
5. Enter cash account book balance taken from the accounting
records.
6. Add any unrecorded cash receipts and errors understating the book
balance to the book balance.
7. Subtract any unrecorded bank fees, NSF checks, and errors
overstating the book balance and deduct them from the book balance.
Knowledge Check 01
D
Match the term and the definition

Transcribed Image Text:8
Ay
Required information
A bank reconciliation proves the accuracy of the depositor's and the bank's records. The bank statement balance is
adjusted for items such as outstanding checks and unrecorded deposits made on or before the bank statement date but
not reflected on the statement. The book balance is adjusted for items such as service charges, bank collections for the
depositor, and interest earned on the account.
Steps in Preparing Bank Reconciliation:
1. Enter bank balance taken from the bank statement.
2. Add unrecorded deposits and bank errors understating the bank
balance.
3. Subtract any outstanding checks and bank errors
overstating the bank balance from the bank balance.
4. Compute the adjusted bank balance.
5. Enter cash account book balance taken from the accounting
records.
6. Add any unrecorded cash receipts and errors understating the book
balance to the book balance.
7. Subtract any unrecorded bank fees, NSF checks, and errors
overstating the book balance and deduct them from the book balance.
Knowledge Check 01
D
Match the term and the definition
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