If a Check Correctly Written and Paid by the Bank

question 59

Multiple Choice

If a check correctly written and paid by the bank for $584 is incorrectly recorded on the company's books for $548, the appropriate treatment on the bank reconciliation would be to

• A)deduct $36 from the book's balance.
• B)add $36 to the book's balance.
• C)deduct $36 from the bank's balance.
• D)deduct $584 from the book's balance.

---

Definitions:

Insurance

A contract by which an insurance company, the insurer, promises to pay a sum of money or give something of value to another, either the insured or the beneficiary, to compensate for a specified loss.

Concurrent Property Ownership

Ownership of property by two or more parties at the same time, where each party has an undivided interest in the whole property.

Subrogation

The legal process by which one party steps into the shoes of another party, to pursue their rights against a third party, usually in insurance claims.

Indemnity

A contractual obligation of one party to compensate the loss incurred by another party due to the acts of the indemnitor or any other party.