In Comparing the Canceled Checks on the Bank Statement with the Entries

question 188

Multiple Choice

In comparing the canceled checks on the bank statement with the entries in the accounting records,it is found that check number 4239 for November's rent was correctly written and drawn for $3,790 but was erroneously entered in the accounting records as $7,390.When reconciling the November bank statement,the company should:

• A)Deduct $3,600 from the book balance of cash.
• B)Add $3,700 to the bank statement balance.
• C)Add $7,390 to the book balance of cash.
• D)Deduct $3,600 from the bank statement balance.
• E)Add 3,600 to the book balance of cash.

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Definitions:

Penetration Pricing

Strategy that sets a low price as a major marketing tactic.

Market Recognition

The degree to which a company or product is known and acknowledged by potential customers and the wider market.

Breakeven Point

The moment when total costs and total revenues are exactly equal, meaning that a business or project is neither making a profit nor experiencing a loss.

Variable Costs

Costs that change in proportion to the level of goods or services produced.