An NSF check should appear in which section of the bank reconciliation?
A)Deductions from the balance per books
B)Deductions from the balance per bank
C)Additions to the balance per books
D)Additions to the balance per bank

Question

Quizplus · Accepted Answer

An NSF (Non-Sufficient Funds) check is a check that cannot be processed because the account holder does not have enough funds. When reconciling the bank statement, an NSF check is recorded as a deduction from the balance per books because the company would have previously recorded the check as an increase to its cash balance when the check was initially received. Upon notification of the NSF check, the company must reverse this entry, thus reducing its book balance.

An NSF Check Should Appear in Which Section of the Bank