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When balance as per Pass Book is the starting point, interest allowed by Bank is
- a)Added
- b)Subtracted
- c)Not required to be adjusted
- d)None of the above
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
When balance as per Pass Book is the starting point, interest allowed ...
Explanation:
When a bank account holder receives a passbook, it contains the record of all transactions made in the account. It includes deposits, withdrawals, and interest earned on the account. The balance as per passbook is the closing balance of the account after all the transactions are recorded.
When the bank calculates the interest on the account, it does not consider the transactions made after the last interest calculation date. Therefore, the bank will adjust the interest earned by subtracting it from the balance as per passbook. The reason for this is that the bank has not yet paid the interest to the account holder, so it is not part of the available balance in the account.
For example, let's assume that the balance as per passbook is $10,000 and the bank calculates the interest earned on the account as $100. The bank will subtract the interest earned from the balance as per passbook, resulting in an adjusted balance of $9,900. This adjusted balance is the available balance in the account, and the bank will use it to process any withdrawals or other transactions.
Therefore, when balance as per passbook is the starting point, interest allowed by the bank is subtracted from it to arrive at the adjusted balance. Option B is the correct answer.
When a bank account holder receives a passbook, it contains the record of all transactions made in the account. It includes deposits, withdrawals, and interest earned on the account. The balance as per passbook is the closing balance of the account after all the transactions are recorded.
When the bank calculates the interest on the account, it does not consider the transactions made after the last interest calculation date. Therefore, the bank will adjust the interest earned by subtracting it from the balance as per passbook. The reason for this is that the bank has not yet paid the interest to the account holder, so it is not part of the available balance in the account.
For example, let's assume that the balance as per passbook is $10,000 and the bank calculates the interest earned on the account as $100. The bank will subtract the interest earned from the balance as per passbook, resulting in an adjusted balance of $9,900. This adjusted balance is the available balance in the account, and the bank will use it to process any withdrawals or other transactions.
Therefore, when balance as per passbook is the starting point, interest allowed by the bank is subtracted from it to arrive at the adjusted balance. Option B is the correct answer.
Community Answer
When balance as per Pass Book is the starting point, interest allowed ...
Explanation:
When a customer opens a bank account, the bank provides a passbook to the customer which contains all the transactions made by the customer. The balance as per passbook is the closing balance as per the customer's record.
When the bank calculates the interest, it considers the balance in the account during the period for which the interest is being calculated. The interest rate is applied to the balance in the account at the end of each day and the interest for the period is calculated based on the balance at the end of each day.
When the bank credits the interest in the customer's account, it is added to the balance in the account. Therefore, the balance as per bank statement will be the balance as per passbook plus the interest credited by the bank.
However, if the bank has not credited the interest in the customer's account, the balance as per bank statement will be less than the balance as per passbook. In this case, the interest allowed by the bank needs to be adjusted in the passbook.
Therefore, when the balance as per passbook is the starting point, and the interest allowed by the bank is not credited in the customer's account, it needs to be subtracted from the balance as per passbook to arrive at the correct balance as per bank statement.
Hence, the correct option is B) Subtracted.
When a customer opens a bank account, the bank provides a passbook to the customer which contains all the transactions made by the customer. The balance as per passbook is the closing balance as per the customer's record.
When the bank calculates the interest, it considers the balance in the account during the period for which the interest is being calculated. The interest rate is applied to the balance in the account at the end of each day and the interest for the period is calculated based on the balance at the end of each day.
When the bank credits the interest in the customer's account, it is added to the balance in the account. Therefore, the balance as per bank statement will be the balance as per passbook plus the interest credited by the bank.
However, if the bank has not credited the interest in the customer's account, the balance as per bank statement will be less than the balance as per passbook. In this case, the interest allowed by the bank needs to be adjusted in the passbook.
Therefore, when the balance as per passbook is the starting point, and the interest allowed by the bank is not credited in the customer's account, it needs to be subtracted from the balance as per passbook to arrive at the correct balance as per bank statement.
Hence, the correct option is B) Subtracted.
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When balance as per Pass Book is the starting point, interest allowed by Bank isa)Addedb)Subtractedc)Not required to be adjustedd)None of the aboveCorrect answer is option 'B'. Can you explain this answer?
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