Bank charges appear on the bank statement but have not been entered in the cash book. What entry is required in the cash book?
Correct answer: B. Credit the bank column and debit bank charges
- A. Debit the bank column and credit bank charges
- B. Credit the bank column and debit bank charges
- C. Debit the bank column and credit sales
- D. Credit the bank column and debit purchases
Explanation
Bank charges reduce the business bank balance and are an expense. The cash book therefore credits the bank column and debits the bank charges account.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
About Bank Reconciliation and Control Accounts
Bank reconciliation explains differences between the cash book and bank statement through unpresented cheques, outstanding deposits, bank charges, direct payments, credited amounts and recording errors. Control accounts summarise receivables and payables ledgers, and their balances are reconciled with individual accounts to locate discrepancies.
Practise Bank Reconciliation and Control Accounts
34 free Bank Reconciliation and Control Accounts MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Accounting questions like this
Accounting is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Bank Reconciliation and Control Accounts questions
A cheque deposited by a business has been entered in the cash book but has not yet been credited by the bank. What is the effect?
A cheque issued by a business has not yet been presented to the bank for payment. How does this item usually affect the bank reconciliation?
What is the main purpose of preparing a bank reconciliation statement?
A customer pays money directly into the business bank account, but the business has not yet recorded it in the cash book. What is the correct treatment?
What is the principal purpose of a control account in a general ledger?
Which item is normally recorded on the credit side of the sales ledger control account?