Financial Accounting Quiz Bank Reconciliation Statement Quiz Share Bank Reconciliation Statement Multiple Choice questions 40 questions in 20 minutes Pass Score 70% 1 / 40 When bank statement shows a debit balance, it means : Unfavorable balance as per bank book Unfavorable balance as per cash book None of the above Overdraft balance as per cash book 2 / 40 If any amount is directly deposited into the bank then ? Cash book will show less balance & bank book will show more Bank book will show double balance Cash book will show more balance & bank book will show less Cash book will show double balance 3 / 40 When should a bank reconciliation statement be prepared ? Monthly Annually Whenever there is a discrepancy Quarterly A bank reconciliation statement is typically prepared monthly to ensure the accuracy of financial records. 4 / 40 In cash book, the favourable balance indicates : Debit Balance Bank Overdraft Credit Balance Adjusted Balance 5 / 40 The check which is deposited into bank but not cleared at the end of a particular year is called : Uncredited check Omitted check Unpresented check Dishonored check 6 / 40 Which of the following would increase the cash book balance but not the bank statement balance ? Bank charges Unpresented cheques Deposits in transit Direct credits Deposits in transit have been recorded in the cash book but have not yet been recorded by the bank. 7 / 40 What type of cheques is that which is issued by a firm but not deposited to the bank : Uncredited cheques Uncollected cheques Outstanding cheques Bounced cheques 8 / 40 When dealing with Bank reconciliation statement while using missing method the credit side of cash book corresponds to : Debit side of cash book None of them Debit side of Bank statement Credit side of Bank statement 9 / 40 Bank reconciliation description is composed of : Controller of the bank Business Manager Business Accountant Bank Accountant 10 / 40 An unadjusted balance in cash book is because of the result of which error ? Outstanding checks Deposit in transit The omission of Bank charges Unpresented checks 11 / 40 In cash book, bank charges of $ 1,000 was not recorded. Name the correct cash book adjustment : No adjustment needed in the cash book It will be credited in cash book It will be debited in cash book Charges will be added to the cash book balance 12 / 40 Unfavorable balance means ? Debit balance in petty cash book Credit balance in Bank statement Debit balance in cash book Credit balance in the cash book 13 / 40 In cash book bank charges recorded : both Credit side and Debit side Debit side None of them Credit side 14 / 40 How are direct debits treated in a bank reconciliation ? Added to the cash book balance Subtracted from the cash book balance Ignored Subtracted from the bank statement balance Direct debits reduce the cash book balance and need to be recorded during reconciliation. 15 / 40 What is the first step in preparing a bank reconciliation ? Adjust the cash book Compare the opening balances Prepare the final balance Identify outstanding items The first step is to compare the opening balances of the cash book and the bank statement to identify any discrepancies at the start. 16 / 40 Favorable balance means ? Debit balance in cash book Credit balance in Bank statement Credit balance in the cash book both Credit balance in Bank statement and Debit balance in cash book 17 / 40 How should bank charges be recorded in the cash book ? Ignored Added to the cash balance Subtracted from the cash balance Added to the bank statement balance Bank charges decrease the cash balance and should be subtracted in the cash book. 18 / 40 Unpresented checks also referred to as : Bounced checks Uncollected checks Outstanding checks Uncredited checks 19 / 40 Which document is used to compare the company's records with the bank's records ? Bank deposit slip Bank reconciliation statement Income statement Cash flow statement The bank reconciliation statement is specifically designed to compare and reconcile differences between the company's records and the bank's records. 20 / 40 If a cheque is dishonored, it means : The cheque has been cashed The cheque has been rejected by the bank The cheque has been transferred The cheque has been deposited A dishonored cheque is one that the bank refuses to pay, often due to insufficient funds in the issuer's account. 21 / 40 Which one of the following is not missing of cash book ? Outstation check Bank charges debited in bank statement? Interest credited in bank, statement Mistakes in cash book 22 / 40 Which of the following would cause a discrepancy between the cash book and the bank statement ? All the answers Direct debits not yet recorded Interest charged by the bank Cheques issued but not yet presented Discrepancies can arise from various sources such as interest charges, unpresented cheques, and direct debits not recorded in the cash book. 23 / 40 Which of the following is NOT a step in preparing a bank reconciliation statement ? Comparing the cash book balance with the bank statement balance Adding bank errors to the cash book Identifying timing differences Adjusting the cash book for items not recorded Bank errors should be corrected in the bank statement, not added to the cash book. 24 / 40 The main purpose of preparing a bank reconciliation statement is? To identify causes of difference between cash book and bank statement To know the bank balance To know the balance of bank statement To correct the cash book 25 / 40 When check is not paid by the bank, it is called ? Dishonored Honored & Endorsed Endorsed Honored 26 / 40 When cash is deposited into bank then the following account would be debited in the company accounts : Overdraft account Cash account Bank account None 27 / 40 If a cheque has been issued but not yet presented for payment, it is: Both (Already deducted in the cash book) and (Not yet recorded in the bank statement) Neither (Already deducted in the cash book) nor (Not yet recorded in the bank statement) Not yet recorded in the bank statement Already deducted in the cash book An issued cheque is recorded and deducted in the cash book but will not appear in the bank statement until it is presented for payment. 28 / 40 A bank reconciliation statement is prepared by ? Registrar Banker Auditors Accountant of the business 29 / 40 On the bank statement, cash deposited by the company is known as : Liability Expenses Debit Credit 30 / 40 What is the effect of bank charges on the bank reconciliation statement ? They decrease the cash book balance No effect They decrease the bank statement balance They increase the cash book balance Bank charges reduce the cash book balance and must be recorded in the reconciliation process. 31 / 40 What does the term "deposits in transit" mean in a bank reconciliation ? Deposits that are still with the company Deposits that have been recorded by the company but not by the bank Deposits that have been rejected by the bank Deposits that the bank has recorded Deposits in transit are those that have been recorded in the company's books but not yet reflected in the bank statement. 32 / 40 Uncollected checks are also known as? Outstation checks Uncleared checks Both Uncleared checks and Outstation checks Outstanding checks 33 / 40 A bank reconciliation statement should be prepared : After the cash book is complete At the end of every financial quarter Before preparing the cash book Before closing the financial year The bank reconciliation statement should be prepared after the cash book is complete to ensure all transactions are recorded. 34 / 40 The balance on the debit side of the bank column of cash book indicate : The total amount has drawn from the bank The total amount overdraft in the bank Cash at bank None of above 35 / 40 A deposit recorded in the bank statement but not in the cash book is called : Direct deposit Dishonored deposit Outstanding deposit Unrecorded deposit An unrecorded deposit is a deposit reflected in the bank statement but not yet recorded in the cash book. 36 / 40 Which item would you subtract from the bank statement balance during a reconciliation? Bank charges Outstanding cheques Direct deposits Bank errors Outstanding cheques are subtracted from the bank statement balance because they are yet to be presented for payment. 37 / 40 Bank reconciliation statement compares a bank statement with ......... Cash payment journal Cash receipt journal Cashbook Financial statements 38 / 40 Which of the following is a timing difference in a bank reconciliation ? Unrecorded deposits Bank fees Unpresented cheques Both Unrecorded deposits and Unpresented cheques Timing differences such as unrecorded deposits and unpresented cheques occur because of delays in recording transactions either by the bank or by the business. 39 / 40 Which of the following is a reason for a bank to dishonor a cheque ? Signature mismatch Post-dated cheque Insufficient funds All the answers A cheque can be dishonored for various reasons, including insufficient funds, being post-dated, or having a signature mismatch. 40 / 40 Bank statement also called : Cash book Debit book Credit book Pass book Your score is LinkedIn Facebook Twitter VKontakte 0% Send feedback a bank reconciliation should be prepared periodically becauseaccounting bank reconciliation statementBank Reconciliation
