Chapter 4 Excel Workbook

Online Banking

A banking transaction conducted over the internet.

Returned or Dishonored Check

A check not honored and returned to the owner because of insufficient funds.

Converted Check

A check that initiates an electronic funds transfer.

Interest-bearing Checking Account

A checking account that pays interest.

Check Register or Check Stub

A record of each check number and date, the amount of each check, the deposits made, debit card transactions, and the balance in the checking account.

Bank Statement

A report showing the activity in a checking account including paid checks, deposits, charges against the account, and the balance on the date of the statement.

Bank Statement

A report showing the activity in the checking account including paid checks, deposits, charges against the account, and the balance on the date of the statement.

Overdraft Protection

A security measure where banks link checking accounts with a saving account, credit line, or credit card so that if more money is withdrawn then is in the checking account it can be taken from the linked account to prevent overdraft fees.

Stop Payment

A service provided by banks to cease payment on a check.

Check

A written order used to tell a bank to pay money from an account to the check holder.

Deposit Slip

A written record of credit to an account.

Checking Account

An account opened at a bank for the purpose of making payments from funds on deposit in that account.

American Bankers Association (ABA)

An association that issues check transit numbers.

Debit Card

An electronic checkbook; a plastic card that is linked to a checking account with a personal identification number or PIN.

Digital Check Images

An electronic image of both the front and back of a cleared check.

Automated Clearing House (ACH)

An electronic network that enables banks to transfer funds among themselves.

Payee

An individual or business paid a certain sum from a checking account as authorized by a check.

Service Charges (SC)

Bank charges; monthly fees charged to the depositor for providing a checking account.

Automatic Payments

Bill payments made directly from your checking account on a regularly scheduled basis.

Nonsufficient Funds (NSF)

Checks that are drawn against an account that does not contain sufficient funds to cover the amount of the checks and will be returned to the holder- usually the payee.

Cancelled Checks

Checks that have been cleared by the bank.

Outstanding Checks

Checks that have been written and deducted from the check register on check stubs but do not appear on the monthly bank statement.

Outstanding Deposits

Deposits that have been made by the depositor but do not appear on the monthly bank statement.

Electronic funds transfer (EFT)

Electronic funds transfer using automated clearing house. This is the process of moving funds electronically from an account in one bank account to an account in another bank.

Reconciliation Form

Form used to complete the reconciliation process.

Checkbook

Includes black checks and deposit slips, along with a check register or check stubs for recording checks written on the account and deposits made in the account.

Automated Teller Machine (ATM)

Machines are located outside of banks, and supermarkets, convenience stores, and shopping malls that allow 24-hour access to bank accounts.

Depositor

Person who is depositing money into an account.

Other Bank Services

Services offered by a bank that are not directly linked to a checking account such as the purchase of certified or cashier's checks, money orders, traveler's checks, notary service, and foreign currency exchange.

Deposit Insurance

The Federal Deposit Insurance Corporation insures depositors' accounts up to 250,00 per person per institution, except for those in retirement homes.

Running Balance

The current balance in an account after all deposits and withdrawals.

Drawee

The drawer's bank.

Drawer

The person or business who writes the check; the person who pays.

Reconcile

The process of comparing the check register with the bank statement so that the balance agrees.

Reconciliation

The process of making adjustments and corrections to the check register or the process of making adjustments and corrections to the check register or check stubs so that the balance agrees with the bank statement balance.

Electronic Bill Paying

The process of paying a bill over the internet which is initiated from a computer.

Bank Endorsement

The signature signed on the back of a check.

Restrictive Endorsement

The words "for deposit only" written on the back of a check, making it only valid for deposit and not for receiving funds.

Direct Deposit

This is a payment made by a deposit directly to the receiver's bank account rather than mailing a check.

Full Endorsement

Used when the payee wants to transfer a check to a third party.