On a bank reconciliation, an unrecorded debit memorandum for printing checks is:
A) Added to the book balance of cash.
B) Deducted from the book balance of cash.
C) Deducted from the bank balance of cash.
D) Noted as a memorandum only.
E) Added to the bank balance of cash.

Question

Quizplus · Accepted Answer

An unrecorded debit memorandum for printing checks indicates that the bank has charged the company's account for the cost of printing checks. This means that the book balance of cash is higher than it should be because the company has not yet recorded this expense. Therefore, the unrecorded debit memorandum should be deducted from the book balance of cash in order to reconcile the two balances.

On a Bank Reconciliation, an Unrecorded Debit Memorandum for Printing