In examining its monthly bank statement, a company discovers that that its account was credited $30 for interest earned. The entry needed to adjust the company's cash balance for this reconciling item will include a:

Question

Business

Davis

4 May, 02:14

In examining its monthly bank statement, a company discovers that that its account was credited $30 for interest earned. The entry needed to adjust the company's cash balance for this reconciling item will include a:

+4

Answers (1)

Know the Answer?

Jade Ho · Answer 1

Added to Cash Book Balance in Bank Reconciliation Statement

Explanation:

Bank Reconciliation Statement BRS is made to correct for the mismatch between bank balance as per cash book & bank balance as per pas book.

If account has been credited (added) with $30 for interest earned, discovered later i. e not recorded in cash book : The amount has been added in passbook, but not in cashbook.

So, to match the difference : Interest earned but not recorded = $30 will be added to 'Favourable Debit balance as per cash book', to achieve 'Favourable Credit balance as per pass book' in the BRS.