Meredith Company Gathered the Following Reconciling Information in Preparing Its

question 94

Multiple Choice

Meredith Company gathered the following reconciling information in preparing its May bank reconciliation: $\begin{array}{ll}\$2,500 & \text { Cash balance per books, } 5 / 31 \\150 & \text { Deposits in transit } \\650 & \text { Notes receivable and interest collected by bank }\\40&\text { Bank charge for check printing }\\1,800&\text { Outstanding checks }\\140&\text { NSF check }\end{array}$ The adjusted cash balance per books on May 31 is

• A) $2,970.
• B) $3,120.
• C) $5,280.
• D) $1,320.

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Definitions:

Absorption Costing

This accounting technique aggregates the total manufacturing costs—direct materials, direct labor, and both variable and fixed overheads—into the calculation of a product’s price.

Cost-plus Pricing

A pricing strategy where a fixed percentage or a fixed amount is added to the cost price to determine the selling price.

Return on Investment

A measure used to evaluate the efficiency or profitability of an investment, calculated as the net profit divided by the cost of investment.

Markup

The amount added to the cost of a product to cover expenses and generate profit, often expressed as a percentage of the cost.