A Cheque Cashed by the Payee for $2,200 Was Recorded

question 7

Multiple Choice

A cheque cashed by the payee for $2,200 was recorded in the company's accounting records for $220. On a bank reconciliation:

• A)$1,980 will be added to the book balance.
• B)$1,980 will be deducted from the book balance.
• C)$1,980 will be added to the bank balance.
• D)$1,980 will be deducted from the bank balance.

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Definitions:

Course of Dealing

The behavior and pattern of actions between parties that establishes a common basis for understanding their conduct in executing agreements.

Nonconforming Goods

Goods delivered under a sales contract that fail to meet the quality or specifications agreed upon by the seller and buyer.

Cure Defects

The action of rectifying or fixing flaws or deficiencies in a product, service, or legal document.

Uniform Commercial Code

A comprehensive set of laws governing commercial transactions in the United States, intended to standardize laws across states.