How Would Outstanding Checks Be Handled When Reconciling the Ending

question 99

Multiple Choice

How would outstanding checks be handled when reconciling the ending cash balance per the bank statement to the correct adjusted cash balance?

• A) They would be added to the balance of the bank statement.
• B) They would be subtracted from the balance of the bank statement.
• C) They would be added to the balance per books.
• D) They would be subtracted from the balance per books.

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Definitions:

Conversion Cost

The blend of work and indirect expenses used to transform raw materials into completed goods.

Work in Process

Refers to the cost of unfinished goods in the manufacturing process including labor, raw materials, and overhead costs.

Total Conversion Costs

Total conversion costs are the sum of labor and overhead expenses incurred to convert raw materials into finished goods.

Ending Work in Process

The balance of goods that are still in the production process at the end of an accounting period and have not yet been completed.