PRC-1 · Chapter 9 · Question 10 of 100
An error made by the bank by incorrectly debiting the business account with Rs. 5,000 for another company's cheque should be corrected by:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Adding Rs. 5,000 to the bank statement balance when preparing the BRS.
Explanation
Bank errors cannot be corrected in the business's cash book. Instead, they are listed as reconciling items in the BRS. Since the bank wrongly deducted 5k, it is added back to the bank statement balance to reconcile with the cash book.
More Bank Reconciliations MCQs
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