PRC-1 · Chapter 9 · Question 84 of 100
A payment of Rs. 800 was incorrectly recorded as Rs. 80 in the cash book. What is the correct adjusting entry?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Credit the cash book by Rs. 720
Explanation
The payment (credit) was under-recorded by Rs. 720 (800 - 80). To correctly reduce the bank balance by the full amount, an additional credit of Rs. 720 is required.
More Bank Reconciliations MCQs
- Q86A Bank Reconciliation Statement is normally prepared:
- Q87In the context of bank reconciliations, a bank overdraft means:
- Q88Which side of the cash book is used to record bank deposits and receipts?
- Q89Which side of the cash book is used to record cheques issued to suppliers?
- Q90If the bank statement shows an overdraft of Rs. 5,000, and unpresented cheques amount to Rs. 2,000, what is the cash book balance…