The following data were obtained from the bank statement and from the process of reconciling the bank balance with the company's cash balance:

Bank service charges $ 20

Deposit outstanding $ 150

Interest earned on the bank account $ 10

Checks outstanding $ 400

Which items should be deducted from and added to the bank balance in completing the reconciliation?

A) Deduct checks outstanding; add service charges and deposit outstanding.

B) Deduct interest earned; add deposit outstanding.

C) Deduct checks outstanding; add deposit outstanding.

D) Deduct deposit outstanding; add checks outstanding.

Answer: Deduct checks outstanding; add deposit outstanding.