alleryOvercasting of the debit side of cash book by ₹2,000 causes the cash book balance to be:
AUnderstated by ₹2,000 amount
BOverstated by ₹2,000 amount
CCorrect, no error involved
DDoubled in absolute value
Answer & Solution
Correct answer: B. Overstated by ₹2,000 amount
1. Overcasting on the debit side means receipts have been overstated.
2. A larger debit total means cash book bank balance appears higher than it should.
3. This is an error type difference that must be corrected, normally via adjusted cash book.
_Source: ICAI BoS Foundation Paper 1, Ch 3 "Bank Reconciliation Statement", §6 (3) Errors_
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