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ACCA Applied Knowledge · Financial Accounting · Bank reconciliations

Which one of the following items would appear as a reconciling item in a bank reconciliation because of a timing difference, requiring no entry in the cash book?

A cheque issued to a supplier but not yet presented is a timing difference. It is already recorded in the cash book and will appear on the bank statement later, so no cash book adjustment is needed, unlike direct debits, dishonoured cheques or interest.

  1. AA direct debit for insurance not yet recorded in the cash book
  2. BA dishonoured customer cheque not yet recorded in the cash book
  3. CBank interest received not yet recorded in the cash book
  4. DA cheque issued to a supplier but not yet presented to the bankCorrect

Explanation

An unpresented cheque is already in the cash book and will clear the bank later, so it is a timing difference needing no cash book entry. The other items are in the bank statement but not the cash book and need cash book adjustment.

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