If a company has overdrawn its bank balance then

A) its cash account will show a debit balance.
B) its cash account will show a credit balance.
C) the cash account debits will exceed the cash account credits.
D) it cannot be detected by observing the balance of the cash account.

Question

Kelly Brager · Accepted Answer

Final Answer : B, Explanation :  When a company overdraws its bank balance, it means the bank account has a negative balance, which is represented in the company's books as a credit balance in the cash account.

If a company has overdrawn its bank balance then

A) its cash account will show a debit balance.
B) its cash account will show a credit balance.
C) the cash account debits will exceed the cash account credits.
D) it cannot be detected by observing the balance of the cash account.

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Learning Objectives

Learning Objectives

Related questions

If a company has overdrawn its bank balance thenA) its cash account will show a debit balance.B) its cash account will show a credit balance.C) the cash account debits will exceed the cash account credits.D) it cannot be detected by observing the balance of the cash account.

Definitions

Learning Objectives

Learning Objectives

Related questions

If a company has overdrawn its bank balance then

A) its cash account will show a debit balance.
B) its cash account will show a credit balance.
C) the cash account debits will exceed the cash account credits.
D) it cannot be detected by observing the balance of the cash account.