All of the Following Bank Reconciliation Items Would Result in a Journal

question 158

Multiple Choice

All of the following bank reconciliation items would result in a journal entry on the company's books except:

• A) interest earned.
• B) deposits in transit.
• C) service charge.
• D) a customer's check returned NSF.

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Definitions:

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal annual amounts, representing the asset's expense.

Capital Lease

A lease agreement that is considered a purchase of the asset for accounting purposes because it transfers substantially all risks and rewards of ownership to the lessee.

Ordinary Gain

A profit resulting from business operations or the sale of assets, excluding extraordinary items and discontinued operations.

Extraordinary Gain

A gain resulting from events or transactions that are both unusual in nature and infrequent in occurrence, separated from regular business operations.