Which transaction caused John to overdraw his account?
1 answer:
By examining the financial figures provided above for John's account, it is clear that check no. 410 for $710.49 was the reason for John's account overdraft. As a result, choice (C) is valid.
<h3>What does overdrawing an account mean?</h3>A transaction in which the account holder is permitted to take more money than the account's actual balance is referred to as an overdraft from the account. The account balance is negative following a transaction that results in an overdraw.
One can clearly infer from the account statement shown above that an overdraw transaction occurred after Check No. 410 for an amount of $710.49 was drawn since the account's balance was negative for the first time.
Hence, Option (C ) is the accurate one.
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Your question is incomplete, probably the complete question is:
Which transaction caused John to overdraw his account?
(A) The Online Bill Payment of $146.67
(B) Check No. 409 for $100
(C) Check No. 410 for $710.49
(D) The Overdraft Fee of $35
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Answer:
Answer is explained in the explanation section below.
Explanation:
Part A: In part a, we are required to show the effects on the financial statements using horizontal statements model.
For that, we need to tabulate the entries properly. So, it cannot be done be done here in the typing section. So, I m putting it into the attachments. Please refer to the attachment for the part a solution.
Part B:
Reason of the difference:
Cash revenue is $8650 but cash flow amount is $9600
Total operating expense incurred is $3350 but the amount paid only $2700
It will create $650 difference income statement and cash flow.
These activities are reasons for the differences between cash flow from the operating activity and net income.
