True or false: The adjusted book balance and the adjusted bank balance must equal each other on a bank reconciliation; otherwise, the cash account is not reconciled.

Question

Alessandro Ross

Social Studies

25 July, 10:32

True or false: The adjusted book balance and the adjusted bank balance must equal each other on a bank reconciliation; otherwise, the cash account is not reconciled.

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Joaquin Herman · Answer 1

Answer:True.

Bank reconciliation is the process of matching cash statement to the corresponding bank statement. The aim is to detect disparities in both balances and make the necessary adjustments.

At the end of the reconciliation process, adjusted cash and bank balances must be equal. Inequlity of these two statement means there are still figures that needs to be adjusted, hence, the accountant should do a thorough investigation to discover the reason for the inequality in both balances