PART 1- TRUE OR FALSE 1. The savings account earns minimal interest and may have a minimum balance requirement. 2. The account holder may use the withdrawal slip to get money from his checking account. 3. The account holder may issue a bank check from a savings account.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
PART 1- TRUE OR FALSE
1. The savings account earns minimal interest and may have a minimum balance requirement.
2. The account holder may use the withdrawal slip to get money from his checking account.
3. The account holder may issue a bank check from a savings account.
4. In banking practice, a check becomes stale if not encashed within one year from the time of
issuance.
5. Deposits in transit refer to collections received on the last day of the month which are
deposited the first working day of the following month.
6. Deposit in transit is a reconciling item which requires an adjusting entry in the books of the
depositor.
7. Bank service charge is an example of an unrecorded bank credit.
8. Bank reconciliation is prepared once a year at the end of the accounting period.
9. An NSF check is a reconciling item that does not require an adjusting entry in the books of
the depositor.
10. Adjusting journal entries are prepared based on the reconciling items on the bank side of
the bank reconciliation.
11. A bank statement is prepared by the depositor to reconcile the difference between his
records and bank records.
12. A bank statement is a letter issued by the bank that certifies the existence of the bank
account.
13. Deposit in transit is a reconciling item added to the unadjusted book balance.
14. Outstanding check is a reconciling item deducted from the unadjusted bank balance.
15. Adjusting journal entries are prepared based on the reconciling items on the bank side of
the bank reconciliation.
Transcribed Image Text:PART 1- TRUE OR FALSE 1. The savings account earns minimal interest and may have a minimum balance requirement. 2. The account holder may use the withdrawal slip to get money from his checking account. 3. The account holder may issue a bank check from a savings account. 4. In banking practice, a check becomes stale if not encashed within one year from the time of issuance. 5. Deposits in transit refer to collections received on the last day of the month which are deposited the first working day of the following month. 6. Deposit in transit is a reconciling item which requires an adjusting entry in the books of the depositor. 7. Bank service charge is an example of an unrecorded bank credit. 8. Bank reconciliation is prepared once a year at the end of the accounting period. 9. An NSF check is a reconciling item that does not require an adjusting entry in the books of the depositor. 10. Adjusting journal entries are prepared based on the reconciling items on the bank side of the bank reconciliation. 11. A bank statement is prepared by the depositor to reconcile the difference between his records and bank records. 12. A bank statement is a letter issued by the bank that certifies the existence of the bank account. 13. Deposit in transit is a reconciling item added to the unadjusted book balance. 14. Outstanding check is a reconciling item deducted from the unadjusted bank balance. 15. Adjusting journal entries are prepared based on the reconciling items on the bank side of the bank reconciliation.
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education