ACCT 2000 Chapter : ACCT Chapter 7 Notes Filled In
Document Summary
Chapter 7 notes: prepare a bank reconciliation. Minimizes the amount of cash on hand. Creates a double record record of bank transactions. Electronic funds transfer allow the transfer of funds without paper (deposit tickets, checks, etc). Include disbursement systems that use wires, telephone and computers to transfer cash. Many employers send payrolls through the eft system. Bank statements are prepared from the bank"s perspective. Deposits received by the bank increase a bank"s liability (customer"s money). Deposits and other amounts added to an account are recorded with credits. Payments out of an account reduce a bank"s liability. Payments and other deductions from an account are recorded with debits. Company cash asset (debit up and credit down) Bank cash from customer (deposits) liability (owed to the customer) (debit down and credit up) Adjustments to the bank balance (bank statement: deposits in transit, outstanding checks, bank errors.
