In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that check number 2889 for December's utilities was correctly written and drawn for $270 but was erroneously entered in the accounting records as $702. The journal entry to adjust the books for the bank reconciliation would include which of the following for this situation? A. Add 3,600 to the book balance of cash.
B. Add $3,700 to the bank statement balance.
C. Add $7,390 to the book balance of cash.
D. Deduct $3,600 from the book balance of cash.

$432 Added in the balance of cash book

Explanation:

Given:

Amount of check = $270

Accounting record = $702

Find:

Correction.

Computation:

Added in the balance of cash book = Accounting record - Amount of check

Added in the balance of cash book = $702 - $270

Added in the balance of cash book = $432

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