Exercises: Checking Accounts and Reconciling a Bank Statement

Define each of these checking account terms: deposit, withdrawal, outstanding check, and overdraft. Write one short sentence for each term.

Mia's check register shows a balance of $\$850.00$. She writes a check for $\$120.50$, makes a deposit of $\$300.00$, and pays $\$45.25$ with her debit card. Find her new register balance.

Name two common checking account fees and explain one way to avoid each. Then explain in one sentence how the main purpose of a savings account differs from that of a checking account.

Ethan's bank statement shows an ending balance of $\$1{,}240$. He has two outstanding checks of $\$85$ and $\$130$ and a deposit in transit of $\$200$. His check register shows a balance of $\$1{,}225$. Find his adjusted bank balance. Does it match the register balance?

Camila compares two checking accounts. Account A has a $\$12$ monthly fee, which is waived with a $\$1{,}500$ minimum balance, and pays no interest. Account B has no monthly fee, pays $0.5\%$ APY, and charges a $\$34$ fee for each overdraft. Her balance is usually about $\$600$, and she overdraws twice a year. Find her yearly cost for each account and say which one is cheaper for her.

Jayden's bank statement shows an ending balance of $\$512.40$. His check register shows $\$498.15$. The statement lists a monthly fee of $\$8.00$ that is not yet in his register. He also has one outstanding check for $\$22.25$. Reconcile the account. Do the adjusted balances agree?

Marcus has $\$40$ in his checking account. In one day he makes debit card purchases of $\$25$, $\$18$, and $\$30$, in that order. His bank charges a $\$35$ fee for each purchase that overdraws the account, and he has opted in to overdraft coverage. Find which purchases cause an overdraft, the total fees, and his ending balance. Then explain what would have happened if he had opted out. Argue which choice is better for him and describe two habits that would help him avoid overdrafts.

Camila has an average balance of $\$2{,}000$ and is choosing among three accounts. The traditional bank has a $\$10$ monthly fee and pays $0.01\%$ APY. The online bank has no fee and pays $0.50\%$ APY, but she would pay $\$3$ for each of about 4 out-of-network ATM uses per month. The credit union has no fee with direct deposit, pays $0.25\%$ APY, and has free ATMs in its network. Find the yearly net cost or gain for each account. Recommend one account. In your answer, mention FDIC or NCUA insurance and convenience, not only cost.