Cheque Number 6135 for $576 Was Incorrectly Entered as $657

question 125

Multiple Choice

Cheque number 6135 for $576 was incorrectly entered as $657.Which adjustment needs to be made?

• A)Decrease the book balance.
• B)Increase the bank statement balance.
• C)Decrease the bank statement balance.
• D)Increase the book balance.

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Definitions:

Total Liabilities

The sum of all financial obligations or debts that a company owes to outside parties.

Acid-Test Ratio

A financial metric used to determine a company’s ability to pay off its short-term liabilities with its most liquid assets, excluding inventory.

Marketable Securities

Financial instruments that can be quickly converted into cash at a reasonable price.

Accounts Receivable

Money owed to a company by its customers for products or services delivered on credit.