Questions: Chapter 7 - Internal Control and CengageNOWv2 Online teachin PRE-TEST Problem #14 of 19 An NSF check appears on the bank statement as a 13 14 a. debit memorandum that decreases the account balance. 15 b. credit memorandum that increases the account balance. c. debit memorandum that increases the account balance. 16 d. credit memorandum that decreases the account balance.

The answer is the first one (or A): a debit memorandum that decreases the account balance.

Explanation for each option:

a. Debit memorandum that decreases the account balance: This is correct. An NSF (Non-Sufficient Funds) check is a check that cannot be processed because the account holder does not have enough funds in their account. When a bank processes an NSF check, it issues a debit memorandum to the account holder, indicating that the check amount is being deducted from their account balance, thus decreasing it.

b. Credit memorandum that increases the account balance: This is incorrect. A credit memorandum is used to increase the account balance, which is not the case with an NSF check.

c. Debit memorandum that increases the account balance: This is incorrect. A debit memorandum decreases the account balance, not increases it.

d. Credit memorandum that decreases the account balance: This is incorrect. A credit memorandum increases the account balance, not decreases it.

In summary, an NSF check results in a debit memorandum that decreases the account balance.