The time necessary for a deposited check to clear through the commercial banking system causes which of the following types of floats?
A) mail
B) processing
C) transit
D) disbursing

Question

Quizplus · Accepted Answer

Transit float is the time period required for the check to clear through the commercial banking system. It is the time taken by the check to travel from the bank of the person who writes the check to the bank of the person who receives it. This type of float is caused by the delay in processing the check by the banking system. Therefore, the time necessary for a deposited check to clear through the commercial banking system causes transit float.

The Time Necessary for a Deposited Check to Clear Through