ACCOUNTING 2 - Q2 REVIEW

A bank account represents funds entrusted by a depositor to a bank for safekeeping.

• TRUE

• FALSE

NSF checks are checks drawn and released to payees but are not yet encashed with the bank.

• TRUE

• FALSE

Book errors are errors committed by the depositor.

• TRUE

• FALSE

Credit memos are deductions made by the bank to the depositor's bank account but not yet recorded by the depositor.

• TRUE

• FALSE

Bank reconciliation is prepared by the bank.

• TRUE

• FALSE

A bank reconciliation statement is a report that is prepared for the purpose of bringing the balances of cash per record and per bank statement into agreement.

• TRUE

• FALSE

The amount of deposits in transit is deducted from the balance per bank statement in preparing the bank reconciliation.

• TRUE

• FALSE

Examples of debit memos include collections made by the bank on behalf of the depositor.

• TRUE

• FALSE

Examples of credit memos include Interest income earned by the depositor.

• TRUE

• FALSE

Credit memos, debit memos, and book errors are referred to as bank reconciling items.

• TRUE

• FALSE