Question

For each timing difference listed, identify whether the difference would be reported on the book side of the reconciliation or the bank side of the reconciliation


For each timing difference listed, identify whether the difference would be reported on the book side of the reconciliation or the bank side of the reconciliation. In addition, identify whether the difference would be an addition or subtraction Is book or bank affected? Is it an addition or subtraction? 


 a. Deposit in transit

 b. Bank collection

 c. Debit memorandum from bank

 d. EFT cash receipt

 e. Outstanding checks

 f. $1,000 deposit erroneously recorded by the bank as $100

 g. Service charges

 h. Interest revenue

 i. $2,500 cash payment for rent expense erroneously recorded by the business as $250

 j. Credit memorandum from bank


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Answer #1

Timing Difference

Book/Bank

Affected

Addition/

Subtraction

a

Deposits in transit

Bank

Added

b

Bank collection

Book

Added

c

Debit Memorandum from bank

Book

Subtracted

d

EFT cash receipt

Book

Added

e

Outstanding Checks

Bank

Subtracted

f

$1000 deposited erroneously recorded

By bank as $100

Bank

Add

g

Service charges

Book

Subtracted

h

Interest Revenue

Book

Added

i

$ 2500 cash payment for rent expense

Erroneously recorded by the business

As $ 250

Book

Subtract

j

Credit memorandum from bank

Book

Added

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