Question

A company failed to record a $1,000 check that was cleared by the bank. To calculate the true cash balance, the $1,000 must be ______ balance

Multiple choice question.
a. added to the unadjusted book
b. added to the unadjusted bank
c. subtracted from the unadjusted book
d. subtracted from the unadjusted bank

A company failed to record a $1,000 check that was cleared by the bank. To calculate the true cash balance, the $1,000 must be ______ balance
Multiple choice question

c. subtracted from the unadjusted book

Answer 1

To calculate the true cash balance, the $1,000 must be subtracted from the unadjusted book balance.

Step-by-step explanation:

In order to calculate the true cash balance, the $1,000 must be subtracted from the unadjusted book balance.

When a company fails to record a check that was cleared by the bank, it means that the company did not account for the transaction in its books. This results in a discrepancy between the company's records and the bank's records.

To correct this discrepancy, the company must subtract the $1,000 from the unadjusted book balance to reflect the fact that the check was not recorded.