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What are the types of adjustments that should be included in a bank reconciliation?

The purpose of performing a bank reconciliation is to reconcile the balance per bank statement to the balance per books. Its unlikely that these two balances will reconcile without factoring in adjustments.

Common adjustments are deposits in transit, outstanding checks, nonsufficient funds, bank collections, interest income, service charges, and errors.

The visual below outlines what adjustments adjust the bank balance vs which items adjust the book balance:


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