check writing mrs. flowers finance & business technology 1
Post on 28-Dec-2015
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Check Writing
• In the U.S., you write a check using your checking account. You can write a check up to the monetary balance you have in your account.
• However, if you have overdraft protection, you may be able to write a check for a higher amount (normally fees will apply).
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Check Writing
• Bouncing a check (having a returned due to insufficient funds) is an offense in the United States.
• The merchant (to whom you wrote the check) may charge you around $30 to $35, and you bank may charge you another $25 to $70.
– These fees can add up for each check you write that goes over due to insufficient funds
• If the amount is large, the recipient may take legal action against you in court, and you may wind up in jail.
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Check Writing
• It is absolutely fine to write a check for small amounts, like $2.
• Most people in the U.S. carry little or no cash with them and pay with credit card or check.
• You can write a check to yourself by writing “Cash” on the payee field.
(when in the bank the teller will cash the check and pay you)
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Date (1)
• The date format in the United States is Month then Date then Year.
• You can write it out in one of several formats, such as:
• 02/14/2011
• Feb 14, 2011
• February 14, 2011
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Date Cont.
• You can post date some payees
• What does post date mean?
• Post date = to put a date on a check that is later than the actual date
• If sending a check that has a due date in the future you can date it for the future date and the company will place it in the bank on that date
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Amount in Numbers (3)
• Write the amount in numbers
• Example: 127.89
• Note that the $ sign is already pre-printed
• Therefore, you do not have to write it again
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Amount in Words (4)
• This will be the same amount that you wrote in the dollar box.
• One hundred twenty seven and 89/100
• *This is the amount a bank will go by if the amounts are different
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Amount Cont.
• Many shops, especially larger shops like Walmart and Winn Dixie, will allow you to write an amount over your store total
• This can be a way to get cash back on your transaction for no fee
• *Typically this amount is no more than $20 over your total
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Memo
• An optional description of the nature of the payment. You can write something like “phone bill”…. “rent”…. “guitar lesson”
• If you have an account number with the payee, you should mention that account number here
• That way if the check and payment stub are separated at the company, they can keep track of whose account to apply the payment to
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Signature (6)
• Your signature, the same way you wrote it when you opened your bank account
• If you have a joint account, and if there are multiple signatories, any authorized person can sign
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Check Number (7)
• Each check has a different check number. Please note that the check number appears twice on the check – once at the top right corner and once at the bottom center
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Routing Number (8)
• This is the routing number of the bank that facilitates electronic clearing of a check
• This number will be the same for almost all account holders at your bank
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• When there is more than one tenant on the check, what did we learn about “and” & “or” in regards to joint tenants?
• “And” is used for joint tenants in common where each person on the check must sign the signature line of the check in order to be a valid check. “Or” is used for tenants with rights of survivorship where anyone on the check can sign as a single signer
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Practice
• Check #1: Walmart buying groceries for a total of $225.82 and you want $20 cash back and it is today’s date.
• Check #2: Paying your rent payment that is due May 1st. You live in Regal Pointe Apartments. Post date the $850 rent payment for May when it is due.
• Check #3: You forgot your ATM card and are on vacation and stop in your bank “Wachovia Bank” and want to cash a check for yourself in the amount of $100 using today’s date.
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