chap 2: bank reconciliation

Question 1

what are the three kinds of bank deposits?

Answer 1

demand deposits, saving deposit, and time deposit

Question 2

it is the current account, checking account, or commercial deposit where deposits are covered by deposits slips and where funds are withdrawable in demand by drawing checks against the bank.

Answer 2

demand deposit

Question 3

true or false: a demand deposit is usually noninterest bearing. however, dome banks allows a demand deposit account as interest bearing.

Answer 3

true

Question 4

the depositor is given a passbook upon the initial deposit. the passbook is required when making deposits and withdrawals.

Answer 4

saving deposit

Question 5

withdrawals are made anytime but the bank sometimes may require notice of withdrawal. it is interest bearing.

Answer 5

saving deposit

Question 6

it is similar to saving deposit in the sense that it is interest bearing. it is evidenced, however, a formal agreement embodied in an instrument called _?

Answer 6

time deposit, certificate of deposit

Question 7

it may be preterminated or withdrawn on demand or after a certain period of time agreed upon.

Answer 7

time deposit

Question 8

of the three kinds of deposit, it is necessary only for a demand deposit or checking account.

Answer 8

bank reconciliation

Question 9

it is a statement which brings into agreement the cash balance per book and cash balance per bank.

Answer 9

bank reconciliation

Question 10

true or false: the reconciliation is usually prepared yearly because the bank provides the depositor with the bank statement at the end of the year.

Answer 10

false - monthly

Question 11

a bank statement is a monthly report of the bank deposit showing:

Answer 11

a. cash balanve per bank at the beginning.

b. deposits made by depositor and acknowledged by the bank.

c. checks drawn by the depositor and paid by the bank.

d. daily balancd pero bank during the month.