A Reconciliation Account Records the Impact of a Transaction Step

question 40

True/False

A reconciliation account records the impact of a transaction step on financial accounting.

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Definitions:

Bank Reconciliation

The process of matching the balances in an entity's accounting records for a cash account to the corresponding information on a bank statement.

Outstanding Checks

Checks that have been written and recorded in the payer's accounting system but have not yet been cleared or cashed by the recipient.

Bank Statement

A summary of financial transactions that have occurred over a given period on a bank account held by a person or business with a financial institution.

Notes Receivable

Claims against debtors that are supported by formal agreements or promissory notes, specifying the amounts owed and payment terms.