S1: Bank Reconciliation Statement is prepared by the bank. S2: Bank Reconciliation Statement is prepared on a specific date. Which statement(s) is/are correct? MCQ with Answer and Explanation
S1: Bank Reconciliation Statement is prepared by the bank. S2: Bank Reconciliation Statement is prepared on a specific date. Which statement(s) is/are correct?
A. S2 only
B. Neither S1 nor S2
C. S1 only
D. Both S1 and S2
Answer: Option A
Solution (By JKSSB Mock Tests)
BRS is prepared by the account holder (the customer), not the bank. It is prepared for a specific date to reconcile the balances as per the Cash Book and the Pass Book on that day. S1 is incorrect, S2 is correct.
S1: In a cash flow statement, the purchase of an investment in the shares of another company is classified under investing activities. S2: The receipt of dividends on those shares is always classified under operating activities. Which statement(s) is/are correct?
Explanation:
S1 is correct; purchasing investments is an investing activity. S2 is incorrect because under Ind AS 7, dividends received can be classified as either operating (as a return on investments) or investing (as a return on investments) activities, providing flexibility.
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