In preparing a bank reconciliation, the amount indicated by a credit memorandum for a note receivable collected by the bank is added to the cash balance per books.

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When a note receivable is collected by the bank, the bank sends a credit memorandum to the company indicating the amount of the collection. This amount is added to the cash balance per books on the bank reconciliation to reconcile the difference between the company's records and the bank's records.

In Preparing a Bank Reconciliation, the Amount Indicated by a Credit