Question

To determine the true cash balance Multiple Choice a. add bank collections of depositors’ accounts receivable to the unadjusted book balance.b. subtract bank service charges from the unadjusted book balance.c. add interest earned from bank to the unadjusted book balance.d. All of the answers describe adjustments that must be made to the unadjusted book balance in order to determine the true cash balance.

Answer 1

Answer: d. All of the answers describe adjustments that must be made to the unadjusted book balance in order to determine the true cash balance.

Explanation:

Options A to C all need to be done to ascertain the True cash balance.

The bank collections from accounts needs to be added to reflect that money was received.

Bank charges need to be subtracted to reflect that the Bank has taken away some money for their administrative roles.

Interest earned from the bank as an income needs to reflect as well.