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When balance as per Cash Book is the starting point, uncollected cheques are:
- a)added in the bank reconciliation statement
- b)subtracted in the bank reconciliation statement
- c)‘Not required to be adjusted in the bank reconciliation statement
- d)neither of the above.
Correct answer is option 'B'. Can you explain this answer?
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When balance as per Cash Book is the starting point, uncollected chequ...
Explanation:
When balance as per Cash Book is the starting point, uncollected cheques are subtracted in the bank reconciliation statement. This is because when the cash book balance is taken as the starting point, it represents the balance of the bank account as per the company's records. However, this balance may not match the balance as per the bank statement due to various reasons, including uncollected cheques.
Uncollected cheques are those cheques that have been issued by the company but have not yet been presented for payment by the recipients. As a result, these cheques do not appear in the bank statement, which means that the bank balance as per the statement will be higher than the cash book balance.
To reconcile this difference, uncollected cheques need to be subtracted from the cash book balance. This adjustment will bring the cash book balance down to the level of the bank balance as per the statement, making them equal.
In summary, uncollected cheques are subtracted from the cash book balance to arrive at the adjusted cash book balance, which is then compared to the bank balance as per the statement to reconcile the two balances.
When balance as per Cash Book is the starting point, uncollected cheques are subtracted in the bank reconciliation statement. This is because when the cash book balance is taken as the starting point, it represents the balance of the bank account as per the company's records. However, this balance may not match the balance as per the bank statement due to various reasons, including uncollected cheques.
Uncollected cheques are those cheques that have been issued by the company but have not yet been presented for payment by the recipients. As a result, these cheques do not appear in the bank statement, which means that the bank balance as per the statement will be higher than the cash book balance.
To reconcile this difference, uncollected cheques need to be subtracted from the cash book balance. This adjustment will bring the cash book balance down to the level of the bank balance as per the statement, making them equal.
In summary, uncollected cheques are subtracted from the cash book balance to arrive at the adjusted cash book balance, which is then compared to the bank balance as per the statement to reconcile the two balances.
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When balance as per Cash Book is the starting point, uncollected chequ...
The ans is b becoz ... uncollected cheques means which bank had not collected ... and we are assuming as bank had collected due to which our cash book balance is more than paSs book ... hence subtracted from cash book.
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When balance as per Cash Book is the starting point, uncollected cheques are:a)added in the bank reconciliation statementb)subtracted in the bank reconciliation statementc)‘Not required to be adjusted in the bank reconciliation statementd)neither of the above.Correct answer is option 'B'. Can you explain this answer?
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