Multiple choice

What will be the reconciliation for interest charged by bank when balance as per cash book is the starting point?

  1. Added in bank reconciliation statement

  2. Subtraction in bank reconciliation statement

  3. Not required to be adjusted

  4. Interest will be paid separately, no entry is required.

  5. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Pass book balance decreases by interest charged by bank, which is yet to be recorded in cash book. Hence, this entry needs to be subtracted in bank reconciliation statement.

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