Which the following is the primary cause for discrepancy between the bank statement and the company's general ledger cash account?
A) Time lags that prevent one of the parties from recording a transaction in the same period as the other.
B) Fraudulent activity occurring with the cash account.
C) Unusual items would be the only cause since discrepancies rarely occur between the bank statement and the general ledger cash account.
D) The only reason for discrepancies would be errors made by either the company or the bank.

Question

Quizplus · Accepted Answer

Time lags can cause transactions to be recorded in different periods by the bank and the company, leading to discrepancies between the bank statement and the general ledger cash account. Fraudulent activity or errors can also cause discrepancies, but time lags are the primary cause. Unusual items can also cause discrepancies, but they are not the only cause.

Which the Following Is the Primary Cause for Discrepancy Between