m anaging y our p ersonal f inance unit 5: writing checks, maintaining a register, and reconciling a...
TRANSCRIPT
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MANAGING YOUR PERSONAL FINANCE UNIT 5: Writing Checks, Maintaining a Register, and Reconciling a Bank Statement
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DO NOW:a. What is the purpose of a checking
account? b. What kind of banking transactions
(activities) can you do with a checking account?
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STANDARD:
5.2 Students will be able to simulate maintaining a checking account for a month (including writing checks, maintaining a check register and reconciling a bank statement).
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GOALS OF THE LESSON
I can correctly complete a check for the payment of an expense.
I can make entries in a check register to record checks, ATM transactions, Debit Card transactions, and deposits.
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UNIT VOCABULARY Checking Account-A bank account at a
financial institution that allows for withdrawals and deposits. Money may be withdrawn using checks, automated cash machines (ATMs) and electronic debits, among other methods.
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VOCABULARYCheck-a written order directing a bank to
pay money; drawn by one person or bank on another; decreases your current balance
Check register-a record of all transactions (activities of a bank account)
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VOCABULARY Deposit-when money is added to your
account (increases your current balance)
ATM withdrawal-when money is taken out of your account through electronic means (there may be a fee); decreases your current balance
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VOCABULARYDebit card withdrawal-used to make purchases; money is taken out of your account (decrease the amount in your account)
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PARTS OF A CHECK
Bank Routing #
Account # Check #
Your Name/
Address
Bank’s Name/
Address
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PLEASE LABEL PARTS OF THE CHECK
Name- Date- Number in Digits- Number in words- Signature- Routing number-
Account Number-
Check Number-
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THE CHECK REGISTERRecord of all transactions (banking activities) that affect your checking account including: deposits checks debit card transactions ATM/cash withdrawals Direct deposits EFT transactions
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HOW ARE TRANSACTIONS ENTERED IN A CHECK REGISTER?
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LET’S RECORD SOME BANKING TRANSACTIONS TOGETHER…(SEE BANKING UNIT: WRITING CHECKS AND USING A REGISTER HANDOUT)
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YOUR TURN…RECORD THE NEXT 5 BANKING TRANSACTIONS (AND CHECK YOUR REGISTER BALANCE WITH YOUR INSTRUCTOR
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TICKET OUT THE DOOR
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DO NOW:Quick Check of
Banking Transactions(see Handout)
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GOALS OF THE LESSON
I can identify key components of a Bank Statement.
I can reconcile my check register.
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MORE VOCABULARYBank statement- a statement of transactions (activities) in a bank account. The bank statement shows all deposits, checks, other withdrawals, and bank fees for a particular period of time.
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MORE VOCABULARYBank Reconciliation-process to help you verify that information on a bank statement and a check register agree and helps you locate, fix errors, and adjust your balance.
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MORE VOCABULARYOutstanding deposit-a deposit that has been recorded in your register but has not yet been processed by the bank.
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MORE VOCABULARYOutstanding check-a check that has been recorded in your register bust has not yet been processed by the bank.
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MORE VOCABULARYService fee - an amount that the bank charges you for using the checking account (some banks waive this fee if you keep a minimum balance in your account).
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THE BANK STATEMENT
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BANK RECONCILIATION -PROCESS TO HELP YOU VERIFY THAT INFORMATION ON A BANK STATEMENT AND A CHECK REGISTER AGREE AND HELPS YOU LOCATE, FIX ERRORS, AND ADJUST YOUR BALANCE
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Look at Reconciling a Bank Statement (Working Together Handout). Compare the balance of bank statement to the balance of your check register. Do they agree? If not, why not?
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BANK STATEMENTS AND RECONCILITATION – WORKING TOGETHER
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DO NOW:
Complete the BANK STATEMENTS AND
RECONCILITATION On Your Own
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TICKET OUT THE DOOR
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DO NOW:Identify reasons why bank statement and check registers may not agree. How many can you list?
1, 2, 3, 4, 5 … ?
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GOALS OF THE LESSON
I can identify reasons why bank statements and check register balances do not agree.
I can complete a banking project that includes banking transactions and reconciling a bank statement.
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Reasons why bank statements and check register balances do not agree:
• Missing transaction. • You forgot to enter it.
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Reasons why bank statements and check register balances do not agree:• Missing transaction (cont.) The bank
statement was prepared before the transaction was recorded by the bank (outstanding checks or deposits).
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Reasons why bank statements and check register balances do not agree:• Missing Transactions (cont.) Bank
fees were charged by the bank.
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Reasons why bank statements and check register balances do not agree:• Errors in math or numbers were
switched in the register (usually your errors).
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EVEN MORE VOCABULARY
EFT (Electronic Funds Transfer)-money is electronically moved from one account to another.
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Direct Deposit (a type of EFT)-money is electronically deposited in your account, increasing your balance. (Example: Employers electronically deposit the employee’s pay directly into the employee’s bank account.)
EVEN MORE VOCABULARY
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Overdraft check (or returned check)- Returned to the writer because of insufficient funds in the account to cover the check (a very expensive mistake as high fees are charged).
EVEN MORE VOCABULARY
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DO NOW:Complete Banking Project 1
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DO NOW:Complete Banking Project 2