In reconciling the bank balance, an unrecorded debit memorandum for printing cheques should be
A) Noted as a memo
B) Added to the book balance of cash
C) Deducted from the book balance of cash
D) Added to the bank balance of cash
E) Deducted from the bank balance of cash

Question

Quizplus · Accepted Answer

An unrecorded debit memorandum represents an amount the bank has charged against the company's account without the company's knowledge. In this case, the company should deduct the amount of the debit memorandum from the book balance of cash to reconcile it with the bank balance. Therefore, option C is the best choice.

In Reconciling the Bank Balance, an Unrecorded Debit Memorandum for Printing