An outstanding check is one that has been issued but not yet reported on a bank statement.

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Multiple Choice

An outstanding check is one that has been issued but not yet reported on a bank statement.

Explanation:
An outstanding check is issued by the company and recorded in its books, but the bank has not yet processed it. Since it hasn’t cleared, it won’t appear on the bank statement yet. This timing difference is what bank reconciliations adjust for, typically by subtracting the amount of outstanding checks from the bank balance to align with the company’s cash balance. Once the check clears, it will show up on the bank statement. So the statement is true.

An outstanding check is issued by the company and recorded in its books, but the bank has not yet processed it. Since it hasn’t cleared, it won’t appear on the bank statement yet. This timing difference is what bank reconciliations adjust for, typically by subtracting the amount of outstanding checks from the bank balance to align with the company’s cash balance. Once the check clears, it will show up on the bank statement. So the statement is true.

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