If a Check Correctly Written and Paid by the Bank

question 64

Multiple Choice

If a check correctly written and paid by the bank for $491 is incorrectly recorded on the company's books for $419, the appropriate treatment on the bank reconciliation would be to

• A) add $72 to the book's balance.
• B) subtract $72 from the book's balance.
• C) deduct $72 from the bank's balance.
• D) deduct $491 from the book's balance.

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Definitions:

Previous

Referring to something occurring before the current point in time or the item immediately before another in order or sequence.

Accord And Satisfaction

A contract law concept where a dispute is settled by an agreement (accord) and the subsequent payment (satisfaction), which discharges the original contractual obligation.

Mutual Agreement

A consensus or accord reached between two or more parties on a matter, often formalized through a contract or verbal understanding.

Specific Performance

An equitable remedy requiring the breaching party to perform as promised under the contract; usually granted only when money damages would be an inadequate remedy and the subject matter of the contract is unique (for example, real property).