Which of the following will not give rise to a difference between the balance shown on a firm’s bank statement and that shown, at the same date, in its nominal (general) ledger account for the bank?
Select ONE answer:
- Errors made by the firm’s bank.
- Cheques are written by the firm which has not yet appeared on its bank statement.
- Lodgements made by the firm which have not yet appeared on its bank statement.
- None of the above.
Show your workings to arrive at your answer, and explain and justify your reasons:
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This multiple-choice question is suitable for Accounting KS5 classes.
The answer is 4
- Not correct – Errors. made by the bank will give rise to a difference because the same errors will not have been made in the nominal (general) ledger.
- Not correct – Cheques written by the firm which have not yet appeared on its bank statement (outstanding cheques) will give rise to a difference because they have been recorded as having been issued in the nominal (general) ledger but they are not recorded in the bank statement.
- Not correct – Lodgements made by the firm which have not yet appeared on its bank statement (outstanding lodgements) will give rise to a difference because they have been recorded in the nominal (general) ledger but they are not recorded in the bank statement.
- Correct
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