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 best describes the process of balancing your account during a bank reconciliation?

Recording only the deposits made during the month in your checkbook register.

Relying solely on the bank statement balance as the final account balance.

Comparing your checkbook register with the bank statement and adjusting for outstanding checks, deposits in transit, and bank errors.

Subtracting all outstanding checks from your bank statement balance without considering deposits in transit.

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Verified step by step guidance

Understand the purpose of bank reconciliation: It is the process of comparing your checkbook register (your personal record of transactions) with the bank statement to ensure both records match and to identify discrepancies.

Identify key components to reconcile: These include outstanding checks (checks issued but not yet cleared by the bank), deposits in transit (deposits made but not yet reflected in the bank statement), and any bank errors or fees.

Compare the checkbook register with the bank statement: Match each transaction in your checkbook register with the transactions listed on the bank statement. Note any differences, such as missing transactions or mismatched amounts.

Adjust for outstanding checks and deposits in transit: Subtract outstanding checks from the bank statement balance and add deposits in transit to arrive at the adjusted bank balance.

Account for bank errors and fees: If the bank has made an error or charged fees not recorded in your checkbook register, adjust your checkbook register accordingly to ensure both records align.