MrsDawson Wrote a Check to Kevin for $50 on New

question 15

Multiple Choice

Mrs.Dawson wrote a check to Kevin for $50 on New Year's Day for clearing the snow from her driveway on Christmas Eve.However, when Kevin tries to cash the check at Mrs.Dawson's bank, he is told that the check is stale.Which of the following is the most likely reason for Mrs.Dawson's check being dishonored by the bank?

• A)Mrs.Dawson did not have enough funds in her checking account.
• B)Mrs.Dawson had dated the check for the previous year instead of the current year.
• C)Mrs.Dawson had not identified Kevin as the payee while writing out the check.
• D)Mrs.Dawson had given Kevin a check which was dated more than six months ahead of the date of issue.

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Definitions:

Permanent Accounts

These are balance sheet accounts whose balances are carried over to the next accounting period, such as assets, liabilities, and equity accounts.

Income Summary Account

A temporary account used in accounting to transfer the sums of revenues and expenses at the end of an accounting period.

Dividends Declared Account

An account used to record the amount of dividends that a company's board of directors has decided to distribute to its shareholders.

Post-closing Trial Balance

A list of all accounts still open after closing entries are made, used to verify the equality of debits and credits.