While preparing the bank reconciliation Terry discovered that the bank had incorrectly paid cheque number 100389 for $900 more than the amount written on the cheque by the company. The bank account has a positive balance. The proper procedure to correct this bank error is to:

Question

Quizplus · Accepted Answer

The correct procedure is to add the error to the bank statement balance in the reconciliation and notify the bank. This adjustment is made to reflect what the balance would have been had the error not occurred, and notifying the bank is necessary to correct the error on their end.

While Preparing the Bank Reconciliation Terry Discovered That the Bank