Question

When balance as per cash book is the starting point, cheques deposited but dishonoured are ____________ .

• A. Subtracted
• B. Not required to be adjusted
• C. Added
• D. None of above

Answer 1

The correct option is A Subtracted

When cheque is deposited in the bank, the account holder would debit his bank column of the cash book to increase the bank balance, but when the same cheque gets dishonoured his cash book would show higher balance than his pass book.

So, while reconciling the bank balances if balance as per cash book is the starting point, cheques deposited but dishonoured are subtracted.