When reconciling a bank account,the company does not have to prepare an adjusting entry for outstanding checks.

Question

Quizplus · Accepted Answer

Outstanding checks are checks that have been written and recorded in the company's cash account but have not yet cleared the bank. They do not require an adjusting entry because they are already reflected in the company's cash balance; the reconciliation process simply accounts for the timing difference between the company's records and the bank's records.

When Reconciling a Bank Account,the Company Does Not Have to Prepare