The accountant for a local manufacturing company is reconciling the company’s bank account for May. For each item listed, state how it would be handled on a bank reconciliation. (Choices may be used more than once.)
-Customer's check was deposited on May 31 but is not included on the bank statement
A)Addition to bank balance
B)Subtraction from bank balance
C)Addition to company balance
D)Subtraction from company balance
E)Not included on the reconciliation

Question

Quizplus · Accepted Answer

This item represents a deposit in transit, which means it has been recorded by the company but not yet by the bank. Therefore, it would be an addition to the bank balance on the reconciliation to reflect the expected increase once the bank processes the deposit.

The Accountant for a Local Manufacturing Company Is Reconciling the Company’s