PRC-1 · Chapter 9 · Question 15 of 100
A standing order payment for rent was executed by the bank and appears on the bank statement. How is this recorded by the business upon receiving the statement?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) It is credited in the adjusted cash book.
Explanation
A standing order is an automatic payment out of the bank account. Since it hasn't been recorded in the cash book yet, the cash book must be updated by crediting it.
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