Flashcards in Financial Management Deck (174)
Banking- Cashier's Check
A check the bank prepares, signed by bank official, that is directly drawn from a person's account.
A check that the bank authenticates and guarantees by setting aside the funds until it is presented for payment.
A check that the bank prepares as a substitute for a regular check to permit the drawer to withdraw funds.
Similar to cashiers check, but can be purchased at the post office or convenience store.
A check that is restricted by amount and time of negotiability.
Special check prepared for those who are traveling or where personal check is not accepted or where carrying cash is not prudent.
A list of all account balances to determine whether the debts equal the credits.
Is a statement that summarizes assets, liabilities and capital balances.
A financial statement that summarizes revenue and expense for a specified period.
An account document that serves to record all daily transaction.
Is the book of all original entry of all transactions.
The balance of an account will be the difference between the debt amount and the credit amount.
The check has only the payee's signature. Thus making to any bearer.
The payee directs how the check is to be paid, such as "for deposit only".
Is also known as a "drawer".
- The depositor
- The person writing the check
The bank in which the drawer has money on deposit.
The party to receive the money as I reacted by the drawer.
Types of checks
- Cashier's check
- Certified check
- Counter check
- Limited check
- Money orders
- Traveler's check
Magnetic Ink Character Recognition.
- preprinted forms containing MICR characters that can be read by a machine.
- The MICR include an ABA (American Banking Association) number that indicates where the bank is located and information
needed to sort and route deposit tickets and checks.
Small form to the left of each check that contains spec to record all relevant information about a check and checking account balance.
Information recorded on the check stub, instead recorded in a booklet maintained with the bound check.
A check the bank refuses to pay generally because of insufficient funds deposited. (NSF- not sufficient funds).
Post dated checks
Checks dated after the date is was written.
Statement of account rendered to each depositor once a month by a bank.
- Balance on deposit at the beginning of the month.
- Amount of deposit credited during the period.
- Amount f checks honored (debited) during the period.
- other items debited or credited during the period.
- Balance on deposit at the end of the period.
Bank statement reconciliation
Is the process of adjusting both balances to reflect the transaction not represented by both the bank statement and check register in order to determine the true balance of the account. If done properly, the check register and the bank statement balance should agree after the adjustments have been made.
- Compare the deposited amounts recorded on the check register with those shown on the bank statement.
- Compare the canceled amounts with those stated on the bank statement and check register.
- Identify ll debits and credits to the account listed on the bank statement.
- Errors found on the check register that mistakenly elevate be deducted or added to the check register, respectively. Errors
should be reported to the bank promptly and adjusted accordingly.
- Add and subtract all of the bank statement and check register. Both adjusted should be equal.
Accounting & Bookkeeping
Describes the language of business, it's the process of recording, classifying, summarizing, reporting, analyzing, and interpreting financial and economic data.
Accounting & Bookkeeping purpose
Provide financial information regarding the current operation to interested parties, especially outsiders.
- Financial condition of a business: Profitability and solvency.
- Managerial performance
- Effectiveness and efficiency of operations
- Compliance with directive regulations