Concept explainers
Identify whether the given statement is true or false.
Answer to Problem 1TF
False statement
Explanation of Solution
Bank reconciliation:
Bank statement is prepared by bank. The company maintains its own records from its perspective. This is why the cash balance per bank and cash balance per books seldom agree. Bank reconciliation is the statement prepared by company to remove the differences and disagreement between cash balance per bank and cash balance per books.
The main purpose of the
Therefore, the given statement “The primary purpose of bank reconciliation is to detect and correct errors made by the bank in its records” is false.
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Chapter 7 Solutions
College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)
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