Flashcards in Chapter#3B: Reconciling the Bank Account Deck (9)
What is Bank Reconciliation?
it allows companies to verify that the company's bank account is accurate
What is a Bank Reconciliation Statement?
its used to account for all outstanding deposits, outstanding checks, bank charges, automatic monthly payments, bank errors and items omitted from the company's books
What is one reason for doing Bank Reconciliation?
Because Banks can make mistakes
What 2 Journals do you use to reconcile your bank account?
Cash Receipts and Cash Disbursements
What is the first step in reconciling the bank account?
to record the balances from the bank statement and general ledger bank account on the bank reconciliation statement
What is Outstanding Deposits
It's when all deposits recorded in the cash receipts journal haven't been deposited in the bank account
What is Outstanding Checks?
its when all checks have been written and are recorded in your Cash Disbursements Journal but do not appear on the Bank Statement
When does Outstanding Checks occur?
when the payee has not cashed or deposited the check in their bank account