In preparing a monthly bank reconciliation, which of the following items would be added to the balance reported on the bank statement to arrive at the correct cash balance? a. outstanding checks b. bank service charge c. deposits in transit d. a customer's note collected by the bank on behalf of the depositor

b. Bank service charge  and c. Deposits in transit

Explanation:

Outstanding checks are checks that have been recognize in the cash book but not in the bank statement. This needs to be deducted from the bank statement to get the cash balance.

Bank service charge is a deduction recognized in the bank but yet top be recorded in the cash book. Hence an addition of the bank charge to the balance per bank statement would help arrive at the cash balance.

Deposits in transit have been recognized in the cash book hence the addition of this item to the bank statement balance would help arrive at the cash book balance.

Customer note collected by the bank on behalf of the depositor need be subtracted to get the cash balance as this item would have been recorded in the bank statement but not in the cash book.

The right options are b. Bank service charge and c. Deposits in transit.

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