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By Accounting Mcqs No Comments

The Bank Reconciliation Statement is prepared?

A. To rectify the mistakes in the Cash Book
B. To arrive at the Bank Balance
C. To arrive at the Cash Balance
D. To bring out the reasons for the difference between the Balance as per Cash Book and the Balance as per Bank Statement

The basic objective of the preparation of the Bank Reconciliation Statement is to locate the reasons for differences between the balance as per Cash book and the balance as per Bank Statement. The ancillary benefits during this process of preparation can be said to be rectification of mistakes in cash book, rectification of mistake in bank statement etc. Hence option D. is the right choice.

Related Mcqs:

  1. Bank reconciliation statement is the comparison of a bank statement (sent by bank) with the _________ (prepared by business).

    A. Cash receipt journal
    B. Cash payment journal
    C. Cash book
    D. Financial statements

  2. Bank reconciliation is a statement prepared to reconcile__________?

    A. Trial balance
    B. Cash book
    C. Bank A/c
    D. Cash as per cash book with bank balance as per bank pass book

  3. Bank reconciliation statement is prepared by____________?

    A. Accountant of the business
    B. Manager of the business
    C. Controller of the bank
    D. Accountant of the bank

  4. The accountant of Leo Ltd. recorded a payment by cheque to a creditor for supply of materials as 1,340.56. The bank recorded the cheque at its correct amount of 3,140.56. The Company has not passed any rectification entries and the error is not detected through the bank reconciliation. The impact of this error is

    A. The Trial Balance will not agree
    B. The balance of creditors is understated
    C. The purchases are understated
    D. The favorable bank balance as per Pass Book is less than the Bank balance as per Cash book

  5. Bank reconciliation statement is a part of_________?

    A. Cash book
    B. Trial balance
    C. Auditors report
    D. None of these

  6. Benefits of preparing Bank Reconciliation Statement includes___________?

    A. It bring out any errors committed in preparation of Cash book / Bank Pass Book
    B. Highlights under delay in clearance of cheques deposited but not credited
    C. Help know actual bank balance
    D. All the three

  7. In the Bank reconciliation statement “Deposit in transit” is usually:

    A. Subtracted from bank balance
    B. Added to bank balance
    C. Added to Cash book balance
    D. Subtracted from cash book balance

  8. In bank reconciliation statement the amount of outstanding checks is added to ________ balance of cash book.

    A. Adjusted
    B. Unadjusted
    C. Understated
    D. Overstated

  9. Which of these documents is not required for Bank Reconciliation?

    A. Bank column of Cash Book
    B. Bank Pass Book
    C. Bank Statement
    D. Trial Balance

  10. _________ Checks that are presented to bank but not yet credited by the bank.

    A. Unpresented checks
    B. Uncredited checks
    C. Outstanding checks
    D. Bounced checks

The correct answer to the question: "The Bank Reconciliation Statement is prepared?" is "To bring out the reasons for the difference between the Balance as per Cash Book and the Balance as per Bank Statement".

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