Smothers Company assembled the following information in completing its March bank reconciliation: balance per bank $7640; outstanding checks $1700; deposits in transit $2600; NSF check $130; bank service charge $40; cash balance per books $8800. As a result of this reconciliation Smothers will
A) reduce its cash account by $40.
B) reduce its cash account by $170.
C) reduce its cash account by $900.
D) increase its cash account by $90.

Question

Quizplus · Accepted Answer

The cash account should be reduced by the NSF check amount ($130) and the bank service charge ($40), totaling $170.

Smothers Company Assembled the Following Information in Completing Its March