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4 cards from this section. Quick, good the night before a test.
What is a deposit in transit?
Think of deposits made recently that aren't on the bank's side yet.
Define outstanding checks.
Consider checks given out to suppliers that have not been cashed.
What is a primary reason for discrepancies in bank reconciliation?
Think about what affects cash availability in the bank.
True or False: Deposits in transit can create discrepancies in bank reconciliation.
Recall the timing of deposit processing by banks.
A company has a cash book showing ₹10,000 and its bank statement shows ₹8,000. There are ₹3,000 in deposits that the bank hasn’t recorded and ₹2,000 in outstanding checks. What is the correct balance?
Ensure you adjust for deposits and checks.
During reconciliation, you notice that a ₹500 bank charge was not recorded. If your cash book indicates ₹7,500 before this charge, what is the new balance after the adjustment?
Keep track of all fees that might affect your balance.
5 more questions in this section. Enroll free to practise them all.
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