In reconciling a bank statement, the bank balance is $2,100, and the checkbook balance is $2,001. Which of the following is the most probable reason for the bank balance being larger than the book balance?

a. The company erroneously recorded a check for an amount less than the actual amount.

b. A deposit in transit was made at the end of the month.

c. The bank has deducted certain amounts for bank service charges. d. There are outstanding checks.

Question

Corbin Vaughan

Business

6 January, 15:10

In reconciling a bank statement, the bank balance is $2,100, and the checkbook balance is $2,001. Which of the following is the most probable reason for the bank balance being larger than the book balance?

a. The company erroneously recorded a check for an amount less than the actual amount.

b. A deposit in transit was made at the end of the month.

c. The bank has deducted certain amounts for bank service charges. d. There are outstanding checks.

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Answers (1)

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Bartlett · Answer 1

d. There are outstanding checks.

Explanation:

If the company erroneously records check for an amount less than the actual amount, in this scenario the book balance will be higher than the bank balance.

If a deposit in transit was made at the end of the month, the book balance will become higher than the bank balance.

If the bank has deducted certain amount for bank service charges, then the bank balance will be less than the book balance.

However, if there are outstanding checks then bank balance will be larger than the book balance.