Bank Reconciliation for Cash Book Balance Steps:

• Note bank statement shows $1,000 overdraft (debit balance, or -$1,000 from business view).
• Adjust for lodgements not credited: add $600 (bank hasn't recorded deposits yet).
• Adjust for unpresented cheques: subtract $300 (bank hasn't deducted cheques yet).
• Adjust for interest charged: add $150 (bank debited it, but cash book hasn't, so cash book is$150 higher).

Why C is correct:

• Reconciled balance is -$1,000 +$600 - $300 +$150 = -$550, a$550 credit balance (overdraft) per cash book definition.

Why the others are wrong:

• A: Ignores interest adjustment, yielding -$700 (not$400 credit).
• B: Misapplies signs or adjustments, no valid path to $400 debit.
• D: Likely errors in adding/subtracting items, no path to $50 debit.

Final answer: C