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Flashcards about bank reconciliation.
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Deposits in Transit
Deposits recorded in the business's books but not yet reflected in the bank statement; add to bank account during reconciliation.
Outstanding Cheques
Cheques issued by the business that have not yet been cleared by the bank; subtract from bank account during reconciliation.
Deposits Made Directly by the Bank
Deposits recorded by the bank but not yet entered in the business’s books (e.g., interest earned, customer direct deposits); add to cash account during reconciliation.
Charges Made Directly by the Bank
Fees or charges deducted by the bank that the business hasn’t recorded yet (e.g., service fees); subtract from cash account during reconciliation.