Question

Interest earned and notes receivable collected _______ the bank account.

O A. are added to
OB. are both added to and deducted from
OC. are deducted from
OD. are not added to or deducted from

Answer 1

Interest earned and notes receivable collected both increase the bank account balance, thus they are added to the bank account.

Step-by-step explanation:

The correct answer is that interest earned and notes receivable collected are added to the bank account. When a company earns interest, it represents income which increases the balance of the company's bank account. Similarly, when notes receivable are collected, this means that cash has been received, also increasing the bank account balance. It's important to recognize these transactions as positive cash flows.