Sparrow Corporation
The items listed below were identified while preparing a bank reconciliation for the checking account of Sparrow Corporation as of March 31, 2012.

- Refer to the information presented for Sparrow Corporation. How will the interest earned on the checking account be handled within a bank reconciliation?
A) Add to the balance from the company records
B) Subtract from the balance from the company records
C) Add to the bank statement balance
D) Subtract from the bank statement balance

Question

Sparrow Corporation 
The items listed below were identified while preparing a bank reconciliation for the checking account of Sparrow Corporation as of March 31, 2012.

- Refer to the information presented for Sparrow Corporation. How will the interest earned on the checking account be handled within a bank reconciliation?
A) Add to the balance from the company records 
B) Subtract from the balance from the company records 
C) Add to the bank statement balance 
D) Subtract from the bank statement balance

Quizplus · Accepted Answer

Interest earned on the checking account is added to the balance from the company records because it represents additional funds that the company has earned and was not previously recorded in the company's books.

Sparrow Corporation The Items Listed Below Were Identified While Preparing a Bank