Question

If a bookkeeper mistakenly recorded a disbursement of $63 instead of the correct amount of $36, the error would be shown on the bank reconciliation as a:

a) $27 addition to the books
b) $36 addition to the books
c) $27 deduction from the books
d) $36 deduction from the books

Answer 1

The error would require a $27 deduction from the books on the bank reconciliation to correct the overstatement caused by mistakenly recording a disbursement of $63 instead of $36.

Step-by-step explanation:

If a bookkeeper mistakenly recorded a disbursement of $63 instead of the correct amount of $36, the error would result in the disbursement being overstated by $27 ($63 - $36 = $27). To correct this error on a bank reconciliation, the bookkeeper would need to make an adjustment that reflects the actual amount spent. The correct adjustment in the bank reconciliation would be a $27 deduction from the books. This is because the initial entry was too high by $27, and subtracting this amount will bring the book's record in line with the actual disbursement of $36.