PRC-1 · Chapter 9 · Question 54 of 100
If bank charges of Rs. 500 were accidentally recorded twice in the cash book, how should this be corrected in the adjusted cash book?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Debit the cash book by Rs. 500
Explanation
Bank charges are recorded as payments (credits). Recording them twice means the credit side is overstated by Rs. 500. To correct this internal error, a debit of Rs. 500 is required in the cash book.
More Bank Reconciliations MCQs
- Q56A receipt of Rs. 7,500 was overstated as Rs. 8,500 in the cash book. Which of the following entries is required to correct this?
- Q57Bank charges of Rs. 150 were omitted entirely from the cash book. Which of the following actions is required?
- Q58A payment of Rs. 1,200 was understated as Rs. 200 in the cash book. Which of the following actions is required?
- Q59A bank statement shows a credit (favorable) balance of Rs. 45,200. Outstanding (unpresented) cheques are Rs. 11,500, and uncleared…
- Q60If the receipt side of the cash book is found to be under-casted, what is the correcting entry in the cash book?