Journal Entries for Bank Reconciliation definitions Flashcards
Journal Entries for Bank Reconciliation definitions
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Bank Reconciliation Process of matching the cash balance on company records with the bank statement to identify discrepancies. Book Column Section in the reconciliation showing adjustments needed to the company's cash records based on bank activity. Journal Entry Formal accounting record used to document financial transactions affecting accounts after reconciliation. Bank Collection Funds received by the bank on behalf of a company, often from customer payments, requiring cash and receivables adjustment. Electronic Funds Transfer Movement of money electronically, either received from customers or paid to suppliers, impacting cash and related accounts. Accounts Receivable Asset account representing amounts owed by customers, adjusted when payments are received or reversed for NSF checks. Accounts Payable Liability account reflecting amounts owed to suppliers, reduced when electronic payments are made. Service Charge Fee imposed by the bank, recorded as an expense and reducing the cash balance in company records. Bank Fee Expense Expense account used to record costs charged by the bank, such as service charges, impacting net income. Interest Revenue Income earned from the bank for maintaining a balance, increasing both cash and revenue accounts. Not Sufficient Funds Check Returned check due to insufficient customer funds, requiring reversal of previously recorded cash receipt. Book Error Mistake in company records, corrected by reversing the incorrect entry and recording the accurate transaction. Cash Account Account reflecting the company's available cash, adjusted for all reconciling items after bank reconciliation.
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