- Scan Question
- + Post
- Get Coins
The bank statement ending balance is $45 lower than the general ledger bank balance. On the bank statement, there is a line item for bank charges and fees of $45.
How should the adjustment be recorded in the general ledger?
SELECT ONLY ONE
Debit Bank Fees Expense $45; Credit Retained Earnings $45
Debit Bank Fees Expense $45; Credit Bank Account $45
Debit Bank Account $45; Credit Retained Earnings $45
Debit Retained Earnings $45; Credit Bank Account $45
Debit Bank Account $45; Credit Bank Fees Expense $45
Due to unrecorded items, the cash book bank balance and the balance on the bank statement are sometimes unbalanced.
The bank fee of $45 is an item recorded by the bank in the bank statement, not an item recorded in the cash book.
Therefore, the adjustment for this is to reduce the cash book-bank balance and recognize the expenses related to these bank charges in the income statement.
The following adjustment should be recorded in General Ledger:
|Bank Fees Expense||$45|