Multiple choice

Credit balance shown by a bank column in cash book is known as :

  1. cash deposited in our bank

  2. overdraft

  3. cash withdrawn from bank

  4. none of them

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A credit balance in the bank column of a cash book indicates that the business has withdrawn more money than it has deposited. This situation is known as a bank overdraft and is treated as a liability.