Question

Why does a company reconcile its bank statement?

Answer 1

(A) To turn up discrepancies between its records and the bank’s records

(B) FASB requires it

(C) Accountants have nothing better to do

(D) To audit the bank’s maintenance of the company’s account

Answer (A): To turn up discrepancies between its records and the bank’s records

Explanation: A bank reconciliation statement is the most common way of coordinating with the balances in a business’s accounting records for a cash account to the related data on a bank statement. The objective of this interaction is to learn the contrasts between the two and to book changes to the accounting records as fitting.