when doing an account reconciliation, interest earned on your account should be: course hero

How should I record interest earned on my account in reconciliation?

When doing account reconciliation, interest earned on your account should be: a. ​listed as outstanding. b. ​compared to your interest calculations. c. ​added to your checkbook ledger. d. ​ignored because the bank has already recorded it.

What is the purpose of reconciliation?

Reconciliation confirms that the recorded sum leaving an account corresponds to the amount that’s been spent and that the two accounts are balanced at the end of the reporting period. Reconciliation is used by accountants to explain the difference between two financial records, such as the bank statement and cash book.

How do you reconcile accounts in accounting?

During reconciliation, you should compare the transactions recorded in an internal record-keeping account against an external monthly statement from sources such as banks and credit card companies. The balances between the two records must agree with each other, and any discrepancies should be explained in the account reconciliation statement.

What does it mean to reconcile a bank statement?

to explain the difference between two financial records, such as the bank statement and cash book. Any unexplained differences between the two records may be signs of financial misappropriation or theft. Account reconciliation is necessary for asset, liability, and equity accounts since their balances are carried forward every year.

What is reconciling an account?

What is Reconciling Account? Reconciling an account is an accounting process that is used to ensure that the transactions in a company’s financial records are consistent with independent third party reports. Reconciliation confirms that the recorded sum leaving an account corresponds to the amount that’s been spent and that ...

What is bank reconciliation statement?

A bank reconciliation statement is a document that matches the cash balance on a company’s balance sheet to the corresponding amount on its bank statement. Reconci. Cash Larceny. Cash Larceny Cash larceny refers to the act of stealing cash that has already been recorded in the books of accounts during a specific period.

What is an accountant responsible for?

Accountants are responsible for examining financial statements to ensure accuracy and compliance with existing laws and regulations, handling tax-related tasks such as calculating the. to explain the difference between two financial records, such as the bank statement and cash book.

What is the most commonly used method of reconciliation?

Documentation review is the most commonly used account reconciliation method. It involves calling up the account detail in the statements and reviewing the appropriateness of each transaction. The documentation method determines if the amount captured in the account matches the actual amount spent by the company.

What is bank error?

A bank error is an incorrect debit or credit on the bank statement of a check or deposit recorded in the wrong account. Bank errors are infrequent, but the company should contact the bank immediately to report the errors. The correction will appear in the future bank statement, but an adjustment is required in the current period’s bank ...

How to compare cash book statements?

Compare the cash book statement against the bank statement. Tick all transactions recorded in the cash book against similar transactions appearing in the bank statement. Make a list of all transactions in the bank statement that are not supported, i.e., are not supported by any evidence such as a payment receipt. 2.