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 statements is correct regarding reconciling a bank account in QuickBooks Online?

Outstanding checks should be deleted from QuickBooks Online if they have not cleared the bank.

Bank reconciliation in QuickBooks Online is only necessary at the end of the fiscal year.

Bank reconciliation in QuickBooks Online automatically updates your bank statement balance.

You should match each transaction in QuickBooks Online to the corresponding transaction on your bank statement.

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Verified step by step guidance

Understand the concept of bank reconciliation: Bank reconciliation is the process of comparing the transactions recorded in your accounting software (e.g., QuickBooks Online) with the transactions on your bank statement to ensure accuracy and completeness.

Review the incorrect statements: Analyze why the other options are incorrect. For example, outstanding checks should not be deleted as they represent valid transactions that have not yet cleared the bank. Bank reconciliation is not limited to the end of the fiscal year; it should be performed regularly (e.g., monthly). Additionally, bank reconciliation does not automatically update your bank statement balance; it is a manual process to ensure alignment.

Focus on the correct statement: The correct approach to bank reconciliation in QuickBooks Online is to match each transaction recorded in QuickBooks Online to the corresponding transaction on your bank statement. This ensures that all transactions are accounted for and discrepancies are identified.

Understand the matching process: During reconciliation, you will compare deposits, withdrawals, checks, and other transactions in QuickBooks Online with those on your bank statement. If discrepancies are found, investigate and resolve them (e.g., correcting errors or identifying missing transactions).

Apply this knowledge in practice: Regularly perform bank reconciliations in QuickBooks Online to maintain accurate financial records. This process helps identify errors, prevent fraud, and ensure the integrity of your accounting data.