Page 362 - Basic College Mathematics with Early Integers

GROUP ACTIVITY 339

Chapter 4 Group Activity

Maintaining a Checking Account balance, or reconcile, the checkbook against the monthly
(Sections 4.1, 4.2, 4.3, 4.4) statement.The steps for doing so are listed below.
This activity may be completed by working in groups or Balancing or Reconciling a Checkbook
individually.
Step 1: Place a check mark in the checkbook register
A checking account is a convenient way of handling money next to each check and deposit listed on the
and paying bills. To open a checking account, the bank or monthly bank statement.Any entries in the reg-
savings and loan association requires a customer to make a ister without a check mark are outstanding
deposit.Then the customer receives a checkbook that con- checks or deposits in transit.
tains checks, deposit slips, and a register for recording Step 2: Find the ending checkbook register balance and
checks written and deposits made. It is important to record add to it any outstanding checks and any inter-
all payments and deposits that affect the account. It is also est paid on the account.
important to keep the checkbook balance current by Step 3: From the total in Step 2, subtract any deposits in
subtracting checks written and adding deposits made. transit and any service charges.
About once a month checking customers receive a
statement from the bank listing all activity that the ac- Step 4: Compare the amount found in Step 3 with the
count has had in the last month. The statement lists a be- ending balance listed on the bank statement. If
ginning balance, all checks and deposits, any service they are the same, the checkbook balances with
charges made against the account, and an ending balance. the bank statement. Be sure to update the check
Because it may take several days for checks that a cus- register with service charges and interest.
tomer has written to clear the banking system, the check Step 5: If the checkbook does not balance, recheck the
register may list checks that do not appear on the monthly balancing process. Next, make sure that the run-
bank statement. These checks are called outstanding ning checkbook register balance was calculated
checks. Deposits that are recorded in the check register correctly. Finally, compare the checkbook regis-
but do not appear on the statement are called deposits in ter with the statement to make sure that each
transit. Because of these differences, it is important to check was recorded for the correct amount.
For the checkbook register and monthly bank statement given:
a. update the checkbook register b. list the outstanding checks and deposits in transit and the totals of these
c. balance the checkbook—be sure to update the register with any interest or service fees
Checkbook Register First National Bank Monthly Statement 4/30

Balance BEGINNING BALANCE: 425.86
# Date Description Payment ✓ Deposit 425.86 Date Number Amount
CHECKS AND ATM
114 4/1 Market Basket 30.27
WITHDRAWALS
4/3 114 30.27
115 4/3 May’s Texaco 8.50
4/4 ATM 50.00
4/4 Cash at ATM 50.00
4/11 117 84.16
4/13 115 8.50
116 4/6 UNO Bookstore 121.38
4/15 119 18.72
4/7 Deposit 100.00
4/22 121 395.00
DEPOSITS
117 4/9 MasterCard 84.16
4/7 100.00
118 4/10 Blockbuster 6.12
4/15 Direct deposit 294.36
SERVICE CHARGES
119 4/12 Kroger 18.72
Low balance fee 7.50
120 4/14 Parking sticker 18.50
INTEREST
Credited 4/30 1.15
4/15 Direct deposit 294.36
ENDING BALANCE: 227.22
121 4/20 Rent 395.00
122 4/25 Student fees 20.00
4/28 Deposit 75.00