The amount of cheque deposited but not cleared by the bank should be __________ from the cash book, if there is__________ f balance in the cash book.
subtracted; favourable
To understand how to adjust the cash book when cheques have been deposited but not yet cleared by the bank, we need to comprehend the concept of 'favourable' and 'unfavourable' balances.
Favourable Balance: A positive balance in the cash book indicates that the business has a surplus. When a cheque is deposited but not cleared, it is not yet added to the bank's balance. Therefore, we should subtract this amount from the cash book to reflect the actual cash available.
Given the question:
The amount of cheque deposited but not cleared by the bank should be subtracted from the cash book, if there is a favourable balance in the cash book.
The correct option is: subtracted; favourable.
Important Questions from Money Market
The interest rate at which the Reserve Bank absorbs liquidity from banks under the Liquidity Adjustment Facility (LAF), on an overnight basis, against the collateral of eligible government securities, is called _____.
Which one of the following is not a part of organised money market?
When the general interest rate reaches a very low level, which of the following statements will be correct?
Which of the following statements are true in context of efficient market?
A. Equilibrium rates of return will prevail
B. Investor cannot earn a positive return
C. Volatility will be very high
D. Securities of listed firms sell at their fair values
E. Investors are generally risk-averse
Choose the most appropriate answer from the options given below:
The words 'Bulls and Bears' are associated with
