1.The following journal entry is necessary upon discovery of a "NSF" check during a bank reconciliation:

A. Accounts Receivable
Cash

B. Not Sufficient Funds Expense
Cash

C. Miscellaneous Expense
Cash

D. No entry is necessary because the bank makes the entry.

E. None of the above

2.State Bank collected a note for Meadow Company. This collection, not yet recorded in Meadow's books, appears on the bank reconciliation as a(n):

A. Addition to balance per general ledger

B. Deduction from balance per bank statement

C. Addition to balance per bank statement

D. Deduction from balance per general ledger

E. None of the above

3.Which of the following items would you add to the bank statement balance to arrive at the reconciled cash balance in a bank reconciliation:

A. Bank service charges

B. Outstanding checks

C. "NSF' checks

D. Bank collection charges

E. None of the above

4.Which of the following would you deduct from the bank statement balance to arrive at the reconciled cash balance in a bank reconciliation:

A. Bank service charges

B. Deposits in transit

C. "NSF" checks

D. Outstanding checks

E. None of the above

5.In reconciling the May bank statement, the vice president discovered that the bookkeeper had recorded a check written for $418 as $481 in the cash disbursements journal. For the bank reconciliation, the $63 error should be:
Answer

A. Added to balance per bank statement

B. Added to balance per general ledger

C. Deducted from balance per bank statement

D. Deducted from balance per general ledger

E. None of the above

6.The following information pertains to Guadalupe Company:
Cash balance per bank statement $7,150
Cash balance per general ledger 7,540
Bank service charge 20
Deposits in transit to bank 925
Outstanding checks 655
NSF check returned by bank 100

Guadalupe should show the following reconciled cash balance from the bank reconciliation on its balance sheet:

A. $6,770

B. $8,445

C. $7,420

D. $8,055

E. None of the above

7.Zetor, Inc.'s June bank statement shows a June 30 balance of $9,050. Prior to reconciliation, its books show a cash balance of $8,710. The information below pertains to Zetor, Inc.
Deposits in transit $700
Checks outstanding 480
Bank service charges 20
Error in Zetor's records overstating cash disbursement 90
Check of another company charged erroneously against
Zetor's bank account 250
Bank statement shows bank collected a note receivable
and interest income for Zetor 740

The reconciled cash balance at June 30 on the bank reconciliation should be:

A. $10,100

B. $ 9,520

C. $ 9,340

D. $ 9,270

E. None of the above

8.In preparing its bank reconciliation at March 31, Clark Company has the following information:
Cash balance per bank statement $37,550
Cash balance per general ledger 38,000
Deposits in transit 5,250
Outstanding checks 5,750
Deposit erroneously recorded by bank in Clark's account
on March 12 250
Bank service charges for March 50
NSF check returned by bank 1,150

What is the proper cash balance at March 31 for balance sheet purposes?
Answer

A. $35,750

B. $36,750

C. $36,800

D. $37,050

E. None of the above

9.After completing a bank reconciliation, you are preparing journal entries to agree the firm's Cash account balance with the reconciled balance shown on the reconciliation. Which of the following requires a journal entry?
Answer

A. Service charges for the period

B. Outstanding checks at the end of the period

C. Deposits in transit at the end of the period

D. An error by the bank in recording one of the firm's deposits

E. None of the above

10.In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that check number 4239 for November's rent was correctly written and drawn for $7,390 but was erroneously entered in the accounting records as $3,790. When preparing the November bank reconciliation, the company should:
Answer

A. Deduct $3,600 from the bank statement balance

B. Add $3,600 to the bank statement balance

C. Add 3,600 to the book balance of cash

D. Deduct $3,600 from the book balance of cash

11.If the company's accountant mistakenly records a deposit of $630 as $360, the error would be shown on the bank reconciliation statement as a:
Answer

A. $270 addition to the book balance

B. $270 deduction from the bank balance

C. $270 deduction from the book balance

D. $270 addition to the bank balance

12.Larry Company prepares bank reconciliations that adjust to the correct balance of cash, based on the following:
Outstanding checks $ 177
Note collected for Larry by bank 550
Bank service charges 27
Check written for $98 incorrectly recorded in books at $89;
check cleared the bank for $98 9
NSF check 82
Unadjusted book balance 3,299
Deposits in transit 192

Determine the adjusted cash balance.

A. $3,749

B. $3,908

C. $3,731

D. $3,554

13.On September 30, the books of Allen Company indicates a balance in the Cash account of $3,675. Determine the adjusted balance on the basis of the following reconciling items:
(a) Deposits of cash sales of $342 had been erroneously recorded in the cash receipts journal as $324.
(b) Deposits in transit not recorded by bank, $500.00.
(c) Bank debit memorandum for service charges, $25.00.
(d) Bank credit memorandum for note collected by bank, $2,850, including $50 interest.
(e) Bank debit memorandum for $218.00 NSF (not sufficient funds) check from Alice Bell, a customer.
(f) Checks outstanding, $2,200.00.

A. $6,800

B. $4,600

C. $6,264

D. $6,300