How many of the statements regarding bank reconciliations appearing below are true?
A bank reconciliation is an internal report prepared to verify the accuracy of both the cash account of a business or individual and the bank statement.
After preparing a bank reconciliation, no adjusting journal entries need to be made for outstanding checks or deposits in transit.
If a company's records show a different cash balance from that shown on the company's bank state ment, either the company or the bank has made an error.

Question

Quizplus · Accepted Answer

1. True - A bank reconciliation is prepared to verify the accuracy of both the cash account of a business or individual and the bank statement.
2. False - Adjusting entries are typically required for outstanding checks and deposits in transit.
3. True - If there is a difference between the cash balance in a company's records and that shown on the bank statement, there is likely an error made by either the company or the bank.

How Many of the Statements Regarding Bank Reconciliations Appearing Below