Day 14 (PF)

FYI: LIFESMARTS FINAL CLASS–ENDS AT MIDNIGHT ON FEBRUARY 22, 2019

WATCH THIS LESSON OVERVIEW VIDEO FIRST TODAY: https://screencast-o-matic.com/watch/cqnQFd3dKY

READ THROUGH THE ENTIRE LESSON; HOWEVER, THE ITEMS IN BOLD ARE FOR A GRADE!!

LEARNING TO RECONCILE

Pit Stop Summary: In an age of online banking and smartphone apps, many consumers no longer bother to balance or reconcile their checking account. The purpose of this Pit Stop is to provide teachers with general guidelines to pass along to students regarding how and why to actively manage their bank account.

During the Budget Challenge® simulation, students should use
the CFS (Cash Flow Spreadsheet) not only as a planning tool for building a
budget but also as a tool for reconciling their CFS to their bank account
activity on a regular basis. Knowing their “available cash balance” will help
students pay their bills on time without incurring costly fees (such as NSF,
Returned Check, and Late Fees).

Terminology Tune-Up:

  1. Balancing: The process of deducting all withdrawals from the beginning balance plus all deposits. 
  2. Bank reconciliation: The process that explains the dollar difference between the bank balance and the corresponding amount in the account holder’s records at a particular point in time.

NAVIGATION TIP #1: Calculating your check register “CFS” Ending Bank Balance.
Once students have entered the beginning balance and all the transactions, the CFS will automatically calculate the “Ending Bank Account Balance” in the yellow column O.

NAVIGATION TIP #2: Reconciliation outages

  1. Reconciliation brings one account balance (the balance per the CFS) in line with another account balance (the balance per the bank).
  2. If the balance per the CFS on a particular day matches the balance per the bank activity table or bank statement for that day, then the account is in balance and the reconciliation is complete. 
  3. If there is a difference, or an “outage”, the student will need to
    review the (deposits and withdrawals) entered into their CFS to the
    transactions (Debits and Credits) posted to their bank account and
    recorded in the bank activity table (found at Student Home>Bank).
    Once all of the activity has been reviewed, outages identified, and the
    CFS updated as needed, and the checking account balance (yellow
    column O) matches the bank account balance for that date, the bank
    reconciliation is complete.
  4. Students should write the Help Desk if they find a mistake at the
    bank or another vendor.
  5. Common outages in Budget Challenge include: bank fees charged by
    the bank and duplicate checks entered on the CFS.

NAVIGATION TIP #3: Keeping the check register, CFS, up to date.

  1. In Budget Challenge, when kept up to date, the CFS helps keep a
    running total (or cash flow) of the bank account balance and helps
    avoid overdrafts.
  2. Balancing and reconciling a bank account is needed when students neglect to record transactions regularly.
  3. Keeping the CFS up to date with pending check,fees and anticipated deposits allows students to manage their cash flow effectively.
  4. By utilizing the Pending Checks Queue (found at Student
    Home>Bank), students can verify their CFS includes all issued checks
    on the date they will clear.
  5. Students can also use the CFS as a budgeting tool by entering all
    their future planned payments on the date they plan to make the
    payment.

DID YOU KNOW?
If an unauthorized check was written on your account notify your bank
immediately. If you identify it timely and communicate it to you financial
institution, you may be protected under federal law.

RIGHT NOW:

  1. WATCH THIS VIDEO ON RECONCILING: https://screencast-o-matic.com/watch/cqnQbj3dEW
  2. SHOW ME YOUR RECONCILED CFS
  3. WATCH AND DO THIS VIDEO ON RECONCILING: https://screencast-o-matic.com/watch/cqnlI53Mxz
  4. Check your email & pay bills if necessary.
  5. Go to your written quizzes on the Student Home page
  6. Click the UNIT MATERIAL for the Getting Started quiz
  7. Read the text, watch the videos, etc. LEARN so you can take the quiz
  8. When you take the quiz remember to use the Unit Material to answer the questions