MOM Chapter 14 Vocab

overdraft

A check written for more money than your account contains

money order

A form of check payment on which the financial institution prints the exact amount covered. Often used by people who do not have a checking account.

Bank Statement

A report of deposits, withdrawals, and bank balances sent to a depositor by a bank

bank reconciliation

A report that accounts for the differences between the bank statement and a checkbook balance

Endorsement

A signature or stamp on the back of a check transferring ownership

nonsufficient funds

A situation that occurs when a check is returned to a depositor because the writer of the check did not have a bank available balance equal to or greater than the amount of the check.

direct deposit service

a service that electronically transfers all or part of any recurring payment

checking account

an account at a bank against which checks can be drawn by the account depositor.

Stale check

check that is more than six months old. It may no longer be honored by the bank

Electronic funds transfer

the use of a computer-based system to move money from the drawer's account to the payee's account