Indicate whether the firm should add or subtract each item below from its balance of cash or the bank’s balance of cash in preparing a bank reconciliation. The first answer is provided as an example. If an item is not a reconciling item, state “No entry.”Reconciliation ItemsBank BalanceCompany Balance1. Checks outstandingSubtractNo entry2. NSF checks________________________________3. Deposit recorded twice by company________________________________4. Interest earned________________________________5. Deposits outstanding________________________________6. Bank service fees________________________________

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Answered: Indicate whether the firm should add or…

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter7: Internal Control And Cash

Section: Chapter Questions

Problem 21E

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Indicate whether the firm should add or subtract each item below from its balance of cash or the bank’s balance of cash in preparing a bank reconciliation. The first answer is provided as an example. If an item is not a reconciling item, state “No entry.”

Reconciliation Items	Bank Balance	Company Balance
1. Checks outstanding	Subtract	No entry
2. NSF checks	________________	________________
3. Deposit recorded twice by company	________________	________________
4. Interest earned	________________	________________
5. Deposits outstanding	________________	________________
6. Bank service fees	________________	________________

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