Question

Liam uses checks and a debit card, but does it not always right all the transactions and his checkbook register. He has lost track of his checkbook balance. Liam looks up the "available balance" using online banking, and write it on the next line as his new checkbook balance available to spend. What is wrong with Liam's method

Answer 1

The available balance online may not reflect all debit transactions or all checks that were written. Some recent debit transactions and check written may not have been posted to his account yet. The available balance would need to subtract any outstanding debit transactions and any written checks that have not cleared his account. This would yield the correct available balance.