Final answer:
The balance on a bank statement and the cash balance in a company's general ledger may not match due to time lags and errors by either the bank or the company. The correct answer is d, encompassing both time lags and potential errors. Regular bank reconciliations are essential to address these differences. The correct option is d. time lags, and errors by the bank or company
Step-by-step explanation:
The balance on the bank statement may differ from the cash balance in the general ledger for a variety of reasons. The correct answer is. time lags, and errors by the bank or company.
Time lags can occur because certain transactions may not yet have been recorded by the bank at the time the statement is issued. Examples include checks written by the company that have not yet been cleared by the bank or deposits in transit. On the other hand, errors might be as simple as the bank incorrectly recording an amount or the company erroneously entering an amount in its books.
It's important for businesses to regularly perform bank reconciliations to identify and correct these discrepancies, ensuring that the records in the general ledger accurately reflect the company's true financial position as per the bank's records.