Question 15 of 50beginner🧠 RememberMCQ1 mark

Unfavourable bank balance means:

Exercise: Test Your Understanding - II | Q: 4 | (Page 14)
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Explanation

Option B is correct because the provided text explicitly states that a credit balance as per the cash book indicates a bank overdraft (excess amount withdrawn over deposits). This is identified as an unfavourable balance. In contrast, a debit balance in the cash book indicates a favourable balance. Therefore, an unfavourable bank balance corresponds to a credit balance in the cash book.