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O Level Accounting (7707)•7707/11/M/J/25
Question 11 from 7707/11/M/J/25

Explanation

Insufficient information to calculate the updated cash book balance Steps:

  • Bank statement balance is $740, but pre-update cash book balance is not provided.
  • Record bank charges by subtracting $30 from cash book balance.
  • Outstanding cheque of $150 is already deducted in cash book; no adjustment needed for it.
  • Cannot compute numerical updated balance without original cash book figure.

Why A is correct:

  • Not enough information to confirm; options assume unstated original cash book balance.

Why the others are wrong:

  • B. $620: Matches inferred pre-update cash book via reconciliation (bank + outstanding cheque effect adjusted for charges), but question asks for post-update.
  • C. $860: Incorrectly subtracts charges from bank + outstanding cheque without proper original cash book.
  • D. $890: Adds outstanding cheque to bank statement, overlooking charges adjustment to cash book.

Final answer: Not enough information.

Topic: Bank reconciliation

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