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 what reconciling a bank account involves?

Preparing financial statements for external reporting.

Recording only the deposits made during the month.

Comparing the company's cash records with the bank statement to identify and explain any differences.

Calculating interest earned on savings accounts.

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Verified step by step guidance

Understand the concept of bank reconciliation: Bank reconciliation is the process of comparing the company's cash records (such as the general ledger or cash book) with the bank statement provided by the financial institution to identify and explain any discrepancies.

Identify the purpose of reconciling a bank account: The goal is to ensure that the company's cash records are accurate and match the bank's records, accounting for any differences such as outstanding checks, deposits in transit, or bank fees.

Analyze the options provided in the question: Review each option to determine which one aligns with the definition and purpose of bank reconciliation.

Eliminate incorrect options: For example, preparing financial statements for external reporting and calculating interest earned on savings accounts are unrelated to the process of reconciling a bank account. Recording only deposits made during the month is also not comprehensive enough to describe reconciliation.

Select the correct answer: The correct description of reconciling a bank account is 'Comparing the company's cash records with the bank statement to identify and explain any differences.'