Cragmont has beginning equity of $277,000, net income of $63,000, withdrawals of $25,000 and no additional investments by owners
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The explanation to the discrepancy arising in Jason's accounts and his bank statement is "Jason transposed the digits on the microwave’s price, which actually cost $86. 74." This can be calculated by reconciling the balance of accounts and bank passbook.
<h3>What is reconciliation statement?</h3>Reconciliation statement refers to a statement that is prepared to match the accounting balance with the balances in bank passbook. The differences arising due due omission, commission, duplication, or error of principal are given proper effect in the reconciliation to match account with the bank balances.
The answer to the given question can be justified as follows:
Given:
Ending balance as per accounts is $491.33.
Ending balance as per bank statement $473.33
Difference in ending balance is
The only statement that justifies the difference of $18 is that the digits of microwave has been transposed from $86.74 to $68.74.
The difference so arising from this error is $86.74 - $68.74 i.e. $18
Hence the correct statement is D
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