Outstanding Cheques from the Prior Period Which Clear the Bank

question 88

Multiple Choice

Outstanding cheques from the prior period which clear the bank in the current period

• A)should be added to the balance per books.
• B)should be deducted from the balance per books.
• C)should be deducted from the balance per bank.
• D)do not affect the current period's bank reconciliation.

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Definitions:

Stale Check

A check that has not been cashed or deposited within a specified time, usually six months, making it void or invalid.

Bank

A financial institution that accepts deposits, offers various accounts, provides loans, and offers other financial services to individuals and businesses.

Restrictive Endorsement

A limitation placed on a check specifying the conditions under which it can be paid or transferred, often used for security purposes.

Pay To The Order

A phrase written on a financial instrument such as a check, indicating the person or entity to which the money is directed.