Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

6. Internal Controls and Reporting Cash

Bank Reconciliation

Financial Accounting

6. Internal Controls and Reporting Cash

Bank Reconciliation

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Multiple Choice

Which of the following is typically considered a fee that may be charged to a checking account and would appear on a bank reconciliation statement?

Outstanding check

Monthly service charge

Deposits in transit

Interest earned

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Verified step by step guidance

Understand the concept of a bank reconciliation statement: A bank reconciliation statement is a document that compares the bank's records with the company's accounting records to identify discrepancies and ensure accuracy. Fees charged to a checking account are typically included in this reconciliation process.

Identify the types of items listed in the problem: The options provided include 'Outstanding check,' 'Monthly service charge,' 'Deposits in transit,' and 'Interest earned.' Each of these items has a specific role in the reconciliation process.

Clarify the nature of a monthly service charge: A monthly service charge is a fee imposed by the bank for maintaining the checking account. This fee is deducted directly from the account balance and would appear on the bank statement, requiring adjustment in the company's records during reconciliation.

Differentiate the other options: 'Outstanding check' refers to checks issued by the company but not yet cleared by the bank, 'Deposits in transit' are deposits made by the company but not yet recorded by the bank, and 'Interest earned' is income credited to the account by the bank. These items are not fees but adjustments made during reconciliation.

Conclude that the monthly service charge is the correct answer: Since it is a fee charged to the account and directly affects the balance, it is the item that would appear on the bank reconciliation statement as a deduction.