Osborn Company assembled the following information in completing its March bank reconciliation: balance per bank $11,460; outstanding checks $2,325; deposits in transit $3,750; NSF check $240; bank service charge $75; cash balance per books $13,200. As a result of this reconciliation, Osborn will
A) reduce its cash account by $1,425.
B) reduce its cash account by $75.
C) increase its cash account by $165.
D) reduce its cash account by $315.

Question

Quizplus · Accepted Answer

The adjusted balance per books is calculated as follows: Beginning balance per books ($13,200) + deposits in transit ($3,750) - outstanding checks ($2,325) - NSF check ($240) - bank service charge ($75) = $14,310. The adjusted balance per books is $14,310, which is less than the balance per bank of $11,460. This means that there was a decrease in cash account by $315.

Osborn Company Assembled the Following Information in Completing Its March