FFM Latest Exam Study Guide with
Complete Solutions 2025
maintaining a checking account - ANSWER 1 - keep track of checks, withdrawals,
and deposits
2 - don't write checks for more than you have (bounce checks)
3 - arrange for overdraft protection
4 - know how to stop a payment
5 - periodically reconcile your account
overdraft protection - ANSWER if there is not enough money in your account when
you write a check, the bank will pay it, but charge you extra (about $35) every time
action of checks - ANSWER transfer your deposited funds
debit card or check card - ANSWER used at an ATM to access deposited funds
check register - ANSWER in checkbook used to keep records to account new balance
interest earning checking account; negotiable order of withdrawal (NOW) - ANSWER
any account on which you can write checks that pays interest
tiered interest - ANSWER a way to calculate interest where the account that pays lower
interest on smaller deposits and higher interest on larger balances
, minimum balance account - ANSWER checking account that requires customers to keep
a certain minimum amount for a specified time period to avoid fees
average balance account - ANSWER checking account for which service fees are
assessed if the account's average daily balance drops below a certain level during a
specified time
direct deposit - ANSWER electronically from payer to depositor's account.
Most depository institutions waive monthly fee for this process
"free" checking - ANSWER no minimum-balance requirement or monthly maintenance
fee. Can still be fees for writing checks with insufficient funds or using other ATMs
cleared check - ANSWER the bank pays the check
cancelled check - ANSWER check sent to your bank so that the funds can be paid
to whomever you had written the check
substitute check - ANSWER the check is scanned by receiving bank, this is created
and transmitted immediately to you bank
stop payment order - ANSWER notice made by a depositor to his or her bank directing
the bank to refuse payment on a specific check drawn by the depositor. Notifying
your bank not to honor a check when it is present for payment
account reconciliation - ANSWER compare your records with your banks
records, checking accurate of both sets and identifying any errors
Complete Solutions 2025
maintaining a checking account - ANSWER 1 - keep track of checks, withdrawals,
and deposits
2 - don't write checks for more than you have (bounce checks)
3 - arrange for overdraft protection
4 - know how to stop a payment
5 - periodically reconcile your account
overdraft protection - ANSWER if there is not enough money in your account when
you write a check, the bank will pay it, but charge you extra (about $35) every time
action of checks - ANSWER transfer your deposited funds
debit card or check card - ANSWER used at an ATM to access deposited funds
check register - ANSWER in checkbook used to keep records to account new balance
interest earning checking account; negotiable order of withdrawal (NOW) - ANSWER
any account on which you can write checks that pays interest
tiered interest - ANSWER a way to calculate interest where the account that pays lower
interest on smaller deposits and higher interest on larger balances
, minimum balance account - ANSWER checking account that requires customers to keep
a certain minimum amount for a specified time period to avoid fees
average balance account - ANSWER checking account for which service fees are
assessed if the account's average daily balance drops below a certain level during a
specified time
direct deposit - ANSWER electronically from payer to depositor's account.
Most depository institutions waive monthly fee for this process
"free" checking - ANSWER no minimum-balance requirement or monthly maintenance
fee. Can still be fees for writing checks with insufficient funds or using other ATMs
cleared check - ANSWER the bank pays the check
cancelled check - ANSWER check sent to your bank so that the funds can be paid
to whomever you had written the check
substitute check - ANSWER the check is scanned by receiving bank, this is created
and transmitted immediately to you bank
stop payment order - ANSWER notice made by a depositor to his or her bank directing
the bank to refuse payment on a specific check drawn by the depositor. Notifying
your bank not to honor a check when it is present for payment
account reconciliation - ANSWER compare your records with your banks
records, checking accurate of both sets and identifying any errors
