1. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Checks are: Using a Checking Account the most common kind of negotiable instrument in use a safe way to send funds through the mail convenient receipts for the people who write them

2. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks To open a checking account, you Opening a Checking Account deposit money in a bank sign a signature card

3. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Then the bank agrees to pay money out, up to the amount you have deposited, when you write a check. Opening a Checking Account

4. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks A bank may refuse to pay a check that is more than six months old without incurring liability. Such a check is known as a stale check. Opening a Checking Account

5. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks You should balance, or reconcile, your bank statement as soon as possible after receiving it. Carefully compare the check register balance with the bank statement balance to make sure that they agree. Balancing Your Checkbook

6. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Don’t forget to take into consideration outstanding checks, or checks you have written that have not yet been returned to the bank for payment. Balancing Your Checkbook

7. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Banks provide regular and special printed check forms. These checks display a series of numbers printed in magnetic ink that make it possible for computers to process the checks quickly and accurately. Writing a Check

8. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks 24.1 A Personal Check

9. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks A check is a draft drawn on a bank and payable on demand. Parities to a Check Drawer—person who writes the check Drawee—bank ordered to pay the money Payee—person to whom the check is made payable

10. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks To avoid negligence, you should write checks that cannot be changed easily or signed by a forger. Avoiding Negligence

11. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks print the figures very close to the dollar sign keep all of the figures close together always start at the extreme left when writing amounts of money in words Steps for Writing a Check

12. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks draw a line through any extra space that remains after you’ve written the amount this prevents someone from putting in words and figures to alter the value of the check Steps for Writing a Check

13. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks be sure figures are the same as written amounts (if there is a difference, the bank will honor the written amount) write the name of the payee close to the words “Pay to the order of” Steps for Writing a Check

14. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks fill in all unused space with a line make a note of the reason for the check Steps for Writing a Check

15. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks sign your name so that it looks as much as possible like the one on the bank signature card never sign a blank check Steps for Writing a Check

16. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks never cross out or change a check once it has been written if you make a mistake, print VOID across the incorrect check and write a new check Steps for Writing a Check

17. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks A bad check is a check drawn on an account in which you have insufficient funds. Bad Checks

18. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Writing a check on an account with insufficient funds is larceny or attempted larceny, unless it is accidental. Bad Checks

19. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks A forged check is a check that is signed by someone other than the drawer without the drawer’s authority. Forgery is a crime, subject to a fine and imprisonment. Forged Checks

20. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks You are guilty of a crime if you knowingly offer a forged check, even if you did not personally commit the act of forgery. Forged Checks

21. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks When an offeror deliberately submits a forged instrument to another, the resulting crime is called uttering. Forged Checks

22. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks You may order your bank to stop payment on a check that has not yet been paid by the bank. Stopping Payment of a Check

23. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks However, if the check is given in payment of an amount actually owed, you still owe the amount of the debt. Stopping Payment of a Check

24. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Fill in the blanks in the statements below. 1.A _____ check is one that is signed by someone other than the drawer without the drawer’s authority.

25. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks ANSWER Forged

26. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks 2.A _____ check is one that is more than six months old.

27. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks ANSWER Stale

28. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks 3.A _____ check is one that is drawn on an account in which there is insufficient funds.

29. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks ANSWER Bad

30. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks ANSWER 4.A _____ check is one that has been written but not yet returned to the bank for payment.

31. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks ANSWER outstanding

32. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned 1.How is a checking account opened? Section 24.1 Assessment

33. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned By depositing money in the bank and signing a signature card. Section 24.1 Assessment Answer

34. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned 2.Describe the proper way to write a check. Section 24.1 Assessment

35. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned When handwriting a check, place the figures very close to the dollar sign and keep all figures close together. Always start at the extreme left when writing amounts of money in words. Section 24.1 Assessment Answer

36. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned Draw a line in any part of the space not needed for the amount. This prevents someone from putting in words and figures to alter the value of the check. Section 24.1 Assessment Answer

37. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned Write the name of the payee close to the words “Pay to the order of” and fill in all unused space with a line. Make a note of the reason for the check. Section 24.1 Assessment Answer

38. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned Sign your name so that it looks as much as possible like the one on the bank signature card. Section 24.1 Assessment Answer

39. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned Never sign a blank a check. Never cross out or change a check once it has been written. Section 24.1 Assessment Answer

40. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned 3.Summarize the process of balancing your checkbook. Section 24.1 Assessment

41. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Reviewing What You Learned Compare the check register balance with the bank statement balance to be sure they agree. When balancing the account, it is necessary to take into consideration outstanding checks. Section 24.1 Assessment Answer

42. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Section 24.1 Assessment Critical Thinking Activity Banking Fees Why do you think banks charge a fee to process an order to stop payment?

43. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Section 24.1 Assessment Critical Thinking Activity Answer Banking Fees Answers may vary but should recognize that the bank is charging for the time that its employees spend processing the order.

44. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Section 24.1 Assessment Legal Skills in Action Calculating Costs You deposit a $100 check from your friend Ted into your checking account and then write a $46.18 check to pay for groceries.

45. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Section 24.1 Assessment Legal Skills in Action Calculating Costs Four days later, you receive a notice from the bank that Ted’s check was bad and your account was debited $25 for the unpaid deposit.

46. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Section 24.1 Assessment Legal Skills in Action Calculating Costs Because the funds from your deposit did not become available, your check was returned to the grocer unpaid. Your account is debited another $25 for the unpaid check.

47. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Section 24.1 Assessment Legal Skills in Action Calculating Costs The next day you receive notice from your grocer that you must pay a fee of $25 for the returned check and replace it with a bank check or money order. You pay 75 cents for the money order.

48. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Section 24.1 Assessment Legal Skills in Action Calculating Costs Calculate how much you really spent to purchase $46.18 worth of groceries.

49. Understanding Business and Personal Law Checking Accounts Section 24.1 Writing Checks Section 24.1 Assessment Legal Skills in Action Answer Calculating Costs $121.93. Original check amount, $46.18. Bank fees, $50. Grocer’s returned check fee, $25. Cost of money order,.75.