Quiz 4: Checking Accounts

As the purchasing manager for Fuzzy Logic Industries, write a check dated April 29, 20xx, in the amount of $24,556.00, to Outback Electronics, Inc., for circuit boards.

A(n) ___________ is a written order to a bank by a depositor to pay the amount specified from funds on deposit in a checking account.

You have just received a check. Your account number is #9299-144-006. Write the following endorsements in the space provided below and identify what type they are. a. Allowing the check to be transferred to Expo, Inc. b. Allowing you to cash the check. c. Allowing you to deposit the check in your account. a. b. c.

On a check, the ___________ is the person or business issuing the check; the ___________ is the person or business named on the check to receive the money.

As cashier for Cellini's Pizza, it is your responsibility to make the daily deposits. Complete the deposit slip below based on the following information. a. Date: January 20, 20xx. b. Checks totaling $344.20. c. Currency of $547.00. d. Coins: 125 quarters, 67 dimes, 88 nickels, and 224 pennies.

When a(n) ___________ card is used, the amount of the transaction is deducted electronically from the checking account.

When Heather Gott went online to check her account balance in the morning, it was $823.71. During the day, she used her debit card for the following purchases: groceries-$48.38, flowers-$13.86, prescription refill-$28.00, and gasoline-$56.28. There was a $0.45 charge to use her debit card for the gas purchase. She also used her debit card to buy a roll of stamps for $44.00. In her mail there was a birthday card with a $75 check from her uncle. Heather took the check to the bank and deposited it. What should she expect her account balance to be the following morning?

Write the word form of $52.45 as it would appear on a check.

From the following information, complete the two check stubs and the check register below. a. Starting balance: $463.30. b. April 15, 20xx, check #450 issued to the Keystone Market for groceries in the amount of $67.78. c. April 17, debit card purchase of $250. d. April 19, deposit of $125.45. e. April 20, deposit of $320.00. f. April 27, check #451 in the amount of $123.10 to Ace Appliance, Inc., for refrigerator repair.

The signature and instructions on the back of a check are known as the ___________.

On October 1, Jessica Clay received her bank statement showing a balance of $374.52. Her checkbook records indicate a balance of $338.97. There was a service charge for the month of $4.40 on the statement. The outstanding checks were for $47.10, $110.15, $19.80, and $64.10. The deposits in transit totaled $125.50. There was a $75.70 debit for automatic payment of her telephone bill. Use the following form to reconcile Jessica's checking account.

There are three types of endorsements used on checks: the blank, the restrictive, and the ___________ endorsement.

Using the form on page 121, prepare a bank reconciliation for Kali Loi from the following checkbook records and bank statement.

The form used to record money being added to the checking account is a called a(n) ___________.

Sometimes banks offer checking accounts that earn interest on the average daily balance of the account each month. This interest is calculated using a formula known as the simple interest formula. The formula is written as: Interest = Principal × Rate × Time I = PRT The formula states that the amount of interest earned on the account is equal to the principal (average daily balance) multiplied by the rate (interest rate per year-expressed as a decimal) multiplied by the time (expressed in years-use 1 12 to represent one month of a year). a. If you have not already done so, complete the Business Decision, Choosing a Bank on page 112. b. Use the simple interest formula to calculate the amount of interest you would earn per month if the Intercontinental Bank was offering 2% (.02) interest per year on checking accounts. (Note that your average daily balance changes from $900 to $2,400 in the last six months of the year.) c. How much interest would you earn per month at Bank of America if it were offering 1.5 percent (.015) interest per year on checking accounts? Round to the nearest cent when necessary. d. Recalculate the cost of doing business with Intercontinental Bank and Bank of America for a year. e. Based on this new information, which of the four banks should you choose for your checking account?

When cash is being withdrawn at the time of a deposit, a(n) ___________ is required on the deposit slip.

Attached by perforation to checks, check ___________ are one method of tracking checking account activity.

A check ___________ is a separate booklet used to keep track of checking account activity.

A bank ___________ is a monthly summary of activities in a checking account.

Additions to a checking account are called ___________; subtractions from a checking account are called ___________.

A bank statement is reconciled when the adjusted checkbook balance ___________ the adjusted bank balance.

Checks that have not yet reached the bank are called ___________ checks. Deposits that have not reached the bank are called deposits in ___________.

You are the owner of the Busy Bee Launderette. Using the blanks provided, write out the following checks in proper form. Check #2550, September 14, 20xx, in the amount of $345.54 to the Silky Soap Company for 300 gallons of liquid soap.

You are the owner of the Busy Bee Launderette. Using the blanks provided, write out the following checks in proper form. Check #2551, September 20, 20xx, in the amount of $68.95 to the Tidy Towel Service for six dozen wash rags.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. Allowing you to deposit the check in your account.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. Allowing you to cash the check.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. Allowing you to transfer the check to your friend David Sporn.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. Properly fill out the deposit slip for The Star Vista Corp. based on the following information: a. Date: July 9, 20xx. b. $1,680 in currency. c. $62.25 in coins. d. Checks in the amount of $2,455.94, $4,338.79, and $1,461.69.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. 7. Properly fill out the deposit slip for Howard Lockwood, based on the following information: a. Date: December 18, 20xx. b. A check for $651.03. c. $150 cash withdrawal.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. From the following information, complete the three check stubs on page 103 in proper form. a. Starting balance $265.73. b. February 12, 20xx, check #439 in the amount of $175.05 to The Fidelity Bank for a car payment. c. February 15, deposit of $377.10. d. February 18, check #440 in the amount of $149.88 to Apex Fitness Equipment for a set of dumbbells. e. February 22, deposit of $570.00. f. February 27, check #441 in the amount of $23.40 to Royalty Cleaners for dry cleaning. g. March 3, debit card purchase-tires, $225.10.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. From the following information, complete the checkbook register: a. Starting balance $479.20. b. April 7, 20xx, deposit of $766.90. c. April 14, 20xx, debit card purchase in the amount of $45.65 to Mario's Market for groceries. d. April 16, ATM withdrawal, $125.00. e. April 17, check #1208 in the amount of $870.00 to Banyan Properties, Inc., for rent. f. April 21, 20xx, electronic payroll deposit of $1,350.00. g. April 27, check #1209 in the amount of $864.40 to Elegant Decor for a dining room set.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. From the following information, complete the checkbook register on the next page through October 10. Cheryl Roberts' account balance on September 26 was $1,196.19. On October 1, she received $3,023.11 by electronic payroll deposit. Also on October 1, she wrote check #1804 to pay her rent in the amount of $1,175.00. Cheryl used her debit card to make purchases on September 28 for $37.79, on October 2 for $311.86, and on October 3 for $164.26. On October 8, she paid her electricity bill, gas bill, and phone bill using her bank's online bill-paying service. Her electricity bill was $142.87. Gas was $18.46, and phone amounted to $38.52. On October 9, she deposited a rebate check for $50.

You have just received a check. Your account number is #099-506-8. Write the following endorsements in the space provided below and identify what type they are. You are the training director for tellers at a large local bank. As part of a new training program that you are developing, you have decided to give teller trainees a "sample" deposit slip, check, and check register with common errors on them. The trainees must find and correct the errors. Your task is to create the three documents. a. On a separate sheet of paper, list some "typical errors" that bank customers might make on a deposit slip, a check, and a check register. b. Use the following blank deposit slip, check, and check register to create "filled-out" versions, each with one error you named for that document in part a. You make up all the details: names, dates, numbers, etc. c. After completing part b , exchange documents with another student in the class and try to find and correct the errors. (If this is a homework assignment, bring a copy of each document you created to class for the exchange. If this is an in-class assignment, temporarily trade documents with the other student after completing part b.)

On April 3, Erin Gardner received her bank statement showing a balance of $2,087.93. Her checkbook showed a balance of $1,493.90. Outstanding checks were $224.15, $327.80, $88.10, $122.42, and $202.67. There was an $8.00 service charge, and the deposits in transit amounted to $813.11. There was an electronic payroll deposit of $450.00. Use the form below to reconcile Erin's account.

Bob Albrecht received his bank statement on July 5 showing a balance of $2,663.31. His checkbook had a balance of $1,931.83. The statement showed a service charge of $15.80 and an electronic payroll deposit of $200.00. The deposits in transit totaled $314.12, and the outstanding checks were for $182.00, $261.40, and $418.00. Use the form below to reconcile Bob's account.

On December 2, John Leahy received his bank statement showing a balance of $358.97. His checkbook showed a balance of $479.39. There was a check printing charge of $13.95, and interest earned was $6.40. The outstanding checks were for $22.97, $80.36, $19.80, and $4.50. The deposits in transit totaled $240.50. Use the form below to reconcile John's account.

You are looking for a bank in which to open a checking account for your new part-time business. You estimate that in the first year, you will be writing 30 checks per month and will make three debit transactions per month. Your average daily balance is estimated to be $900 for the first six months and $2,400 for the next six months. Use the following information to solve the problem. a. Calculate the cost of doing business with each bank for a year Intercontinental Bank: City National Bank: Bank of America: First Union Bank: b. Which bank should you choose for your checking account?