CA Foundation Exam > CA Foundation Questions > While preparing bank reconciliation statement...
Start Learning for Free
While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?
- a)Cheques deposited but not cleared
- b)Cheques issued but not presented to bank
- c)Cheques directly deposited in bank by a customer.
- d)Overcasting of Cr. side of the bank account in cash book.
Correct answer is option 'A'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Most Upvoted Answer
While preparing bank reconciliation statement with favourable balance ...
We are given with favourable balance as per cash book, cheque deposited but not cleared means we have given debit to the cash book but it is not collected by the bankers and hence the balance of cash book increases therefore we need to decrease it so option A will be the correct answer
Free Test
FREE
| Start Free Test |
Community Answer
While preparing bank reconciliation statement with favourable balance ...
Explanation:
The bank reconciliation statement is prepared to reconcile the differences between the bank balance as per the cash book and the bank statement. It helps to identify any errors or discrepancies that may have occurred during the recording of transactions.
When preparing a bank reconciliation statement with a favorable balance as per the cash book, we need to account for items that have been recorded in the cash book but have not yet been reflected in the bank statement. These items will be added to the bank statement balance to arrive at the adjusted cash book balance.
Let's analyze each option to understand why option 'A' (cheques deposited but not cleared) will not be added in this case:
a) Cheques deposited but not cleared:
- When a cheque is deposited in the bank, it takes some time for the bank to process and clear the cheque.
- Until the cheque is cleared, it will not be reflected in the bank statement.
- As the cash book already includes the record of the cheque deposit, adding it to the adjusted cash book balance would result in double-counting.
- Therefore, cheques deposited but not cleared are not added to the adjusted cash book balance.
b) Cheques issued but not presented to bank:
- Cheques issued by the company but not yet presented to the bank for payment are not reflected in the bank statement.
- As the cash book already includes the record of the cheque issuance, adding it to the adjusted cash book balance would result in double-counting.
- Therefore, cheques issued but not presented to the bank are not added to the adjusted cash book balance.
c) Cheques directly deposited in bank by a customer:
- Cheques directly deposited in the bank by a customer will be reflected in the bank statement.
- As these cheques are not recorded in the cash book, they need to be added to the adjusted cash book balance to reconcile the difference.
d) Overcasting of Cr. side of the bank account in cash book:
- Overcasting refers to an error where the amount is mistakenly recorded higher than the actual value.
- If the credit side of the bank account in the cash book is overcast, it means the cash book balance is higher than the actual bank balance.
- To rectify this error, the overcast amount needs to be deducted from the cash book balance to arrive at the adjusted cash book balance.
Therefore, the correct answer is option 'A' (cheques deposited but not cleared) as it would result in double-counting if added to the adjusted cash book balance.
The bank reconciliation statement is prepared to reconcile the differences between the bank balance as per the cash book and the bank statement. It helps to identify any errors or discrepancies that may have occurred during the recording of transactions.
When preparing a bank reconciliation statement with a favorable balance as per the cash book, we need to account for items that have been recorded in the cash book but have not yet been reflected in the bank statement. These items will be added to the bank statement balance to arrive at the adjusted cash book balance.
Let's analyze each option to understand why option 'A' (cheques deposited but not cleared) will not be added in this case:
a) Cheques deposited but not cleared:
- When a cheque is deposited in the bank, it takes some time for the bank to process and clear the cheque.
- Until the cheque is cleared, it will not be reflected in the bank statement.
- As the cash book already includes the record of the cheque deposit, adding it to the adjusted cash book balance would result in double-counting.
- Therefore, cheques deposited but not cleared are not added to the adjusted cash book balance.
b) Cheques issued but not presented to bank:
- Cheques issued by the company but not yet presented to the bank for payment are not reflected in the bank statement.
- As the cash book already includes the record of the cheque issuance, adding it to the adjusted cash book balance would result in double-counting.
- Therefore, cheques issued but not presented to the bank are not added to the adjusted cash book balance.
c) Cheques directly deposited in bank by a customer:
- Cheques directly deposited in the bank by a customer will be reflected in the bank statement.
- As these cheques are not recorded in the cash book, they need to be added to the adjusted cash book balance to reconcile the difference.
d) Overcasting of Cr. side of the bank account in cash book:
- Overcasting refers to an error where the amount is mistakenly recorded higher than the actual value.
- If the credit side of the bank account in the cash book is overcast, it means the cash book balance is higher than the actual bank balance.
- To rectify this error, the overcast amount needs to be deducted from the cash book balance to arrive at the adjusted cash book balance.
Therefore, the correct answer is option 'A' (cheques deposited but not cleared) as it would result in double-counting if added to the adjusted cash book balance.
Attention CA Foundation Students!
To make sure you are not studying endlessly, EduRev has designed CA Foundation study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in CA Foundation.
|
Explore Courses for CA Foundation exam
|
|
Similar CA Foundation Doubts
Top Courses for CA FoundationView all
While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer?
Question Description
While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer?.
While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer?.
Solutions for While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer?, a detailed solution for While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? has been provided alongside types of While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice While preparing bank reconciliation statement with favourable balance as per cash book which of the following will not be added?a)Cheques deposited but not clearedb)Cheques issued but not presented to bankc)Cheques directly deposited in bank by a customer.d)Overcasting of Cr. side of the bank account in cash book.Correct answer is option 'A'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup