Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 40 - No. 6)
What is the effect on the company's cash balance when an NSF check is returned?
The cash balance increases.
The cash balance decreases.
The cash balance remains unchanged.
The cash balance decreases on the bank statement.
Explanation
An NSF check means that the customer's check bounced, and the company's cash balance is reduced.
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