If a Bookkeeper Mistakenly Recorded a Cheque as $38 Instead

question 129

Multiple Choice

If a bookkeeper mistakenly recorded a cheque as $38 instead of the correct amount of $83, the error would be shown on the bank reconciliation as a:

• A)$45 addition to the book balance.
• B)$45 deduction from the book balance.
• C)$45 deduction from the bank balance.
• D)$45 addition to the bank balance.

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Definitions:

Base Case

The default scenario in scenario analysis, used as a benchmark to compare the outcomes of alternative assumptions or actions.

NPV

Net Present Value, a calculation used to assess the profitability of an investment by summing the present values of all expected future cash flows minus the initial investment cost.

Break-even Points

The level of production or sales at which total revenues equal total expenses, resulting in no net profit or loss.

Cash Break-even

The point at which a business's cash expenses equal its cash revenues, resulting in no net cash flow.