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A) Cash book will show less balance & bank book will show more B) Cash book will show more balance & bank book will show less C) Cash book will show double balance D) Bank book will show double balance
its infact option A
A because the cheque isued is already booked, so ( debit creditors/ credit bank account) so the bank balance will show less in the cash book and the accounting while the bank account balance is more, this will be shown at the bank reconciliation till the cheque is cleared and paid by the bank
The closest answer is A.
Fainancial systems nowadays show that the check is drawn and book the amount in the bank balance until the check is collected or cancelled. Such systems do calrify this issue on the bank reconceliation produced by the system.
A
A. Being the cheque is issued to the creditors from your account while it remains uncleared by bank.
A. since at the time of issuing the cheque, the entry in our books is credit to bank thus reducing our bank balance
Correct answer is A. when a cheque is issued following enter is passed, { Dr Supplier Cr Bank). So it will reduce ledger balance but due to unpreseted in bank the bank show more balance.
in order to reconcillation these cheque should be add back to cash book balance.
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