Z’s bank statement shows a balance of $825 overdrawn. The bank statement include

Question

Z’s bank statement shows a balance of $825 overdrawn. The bank statement includes bank charges of $50, which have not been entered in the cash book. There are unpresented cheques totalling $475 and deposits not yet credited of £600. The bank statement incorrectly shows a direct debit payment of $160, which belongs to another customer. What figure for the bank balance should be shown in the statement of financial position? A. $590 overdrawn. B. $540 overdrawn. C. $790 overdrawn. D. $840 overdrawn.

Explanation / Answer

Answer: Option - B ($540 over drawn)

Particulars In$ Overdrawn (negetive balance) -825 Less: Checks unpresented 475 Add: Incorrect direct debit payment 160 Add: Deposits Not yet credited 600 Adjusted bank balance (overdrawn) -540

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