Thompson Company Gathered the Following Reconciling Information in Preparing Its

question 85

Multiple Choice

Thompson Company gathered the following reconciling information in preparing its October bank reconciliation:? $$\begin{array} { | l | l | r | } \hline & \text { Cash balance per bank, October } 31 & \$ 17,000 \\\hline & \text { Note receivable collected by bank } & 4,800 \\\hline & \text { Outstanding checks } & 6,500 \\\hline & \text { Deposits in transit } & 3,000 \\\hline & \text { Bank service charge } & 50 \\\hline & \text { NSF check } & 2,300 \\\hline\end{array}$$ Using the above information, determine the cash balance per books (before adjustments) for Thompson Company.

• A) $11,050
• B) $19,450
• C) $15,950
• D) $11,150

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Definitions:

Normal Profit Rate

Zero economic profit, providing just the competitive rate of return on the capital (and labor) of owners. An above-normal profit will draw more entry into the market, whereas a below-normal profit will lead to an exit of investors and capital.

Contestable Market

A market where companies can enter and exit freely, with low barriers to entry and exit, leading to competitive prices and efficient outcomes.

Low Entry And Exit

Refers to markets where there are minimal barriers to starting or exiting a business, leading to high levels of competition and innovation.

Highly Contested

Describes a situation, item, or issue that is the subject of intense competition or dispute among parties.