A Company Erroneously Records a $50 Cheque Received from a Customer

question 40

Multiple Choice

A company erroneously records a $50 cheque received from a customer as $500 in its records.What must it now do when reconciling its bank statement?

• A) It must increase the balance per its records by $500.
• B) It must increase the balance per its records by $450.
• C) It must decrease the balance per its records by $500.
• D) It must decrease the balance per its records by $450.

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Definitions:

Debt-For-Nature Swaps

Financial transactions in which a portion of a developing country's foreign debt is forgiven in exchange for local investments in environmental conservation projects.

Secondary Succession

The ecological recovery process that occurs in an area where the natural vegetation has been removed or destroyed but the soil remains intact.

Large-Scale Ranching

An extensive form of agriculture operation where livestock such as cattle, sheep, or horses are raised on large tracts of land.

National Parks

Protected areas of natural or cultural significance, set aside by governments for conservation purposes and public enjoyment.