A Cheque Was Written by a Business for $329, but Was

question 103

Multiple Choice

A cheque was written by a business for $329, but was recorded erroneously in the cash ledger as $239. How would this error be included on the bank reconciliation?

• A)A deduction on the bank side
• B)An addition on the book side
• C)An addition on the bank side
• D)A deduction on the book side

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Definitions:

Perpetual inventory system

A method of accounting that continuously updates the inventory balance, recording each purchase and sale of goods immediately through inventory accounts.

FIFO inventory cost method

An inventory valuation method where the cost of goods sold is based on the cost of the earliest purchased items, standing for "First In, First Out".

Ending inventory value

The final value of all unsold goods at the end of an accounting period.

FIFO

First-In, First-Out, an inventory valuation method where goods produced or acquired first are sold, used, or disposed of first.