Accounting I
Chapter 6 – Cash
Control Systems
TERMS REVIEW
checking account
endorsement
blank endorsement
special endorsement
restrictive endorsement
postdated check
Lesson 6-1, page 124
TERMS REVIEW
Checking Account
A bank account from which
payments can be ordered by a
depositor.
Lesson 6-1, page 126
TERMS REVIEW
Endorsement
A signature or stamp on the back
of a check transferring ownership.
Lesson 6-1, page 127
TERMS REVIEW
Blank Endorsement
An endorsement consisting only
of the endorser’s signature.
Lesson 6-1, page 127
TERMS REVIEW
Special Endorsement
An endorsement indicating a new
owner of a check. (a.k.a. 3rd party
checks or endorsements in full)
Lesson 6-1, page 127
TERMS REVIEW
Restrictive Endorsement.
An endorsement restricting
further transfer of a check’s
ownership.
Lesson 6-1, page 127
TERMS REVIEW
Postdated Check
A check with a future date on it.
(Not acceptable for of dating a
check.)
Lesson 6-1, page 128
DEPOSITING CASH
Lesson 6-1, page 126
DEPOSIT RECORDED ON A CHECK STUB
Lesson 6-1, page 126
BLANK ENDORSEMENT, SPECIAL ENDORSEMENT,
AND RESTRICTIVE ENDORSEMENT
Blank
Endorsement
Special
Endorsement
Restrictive
Endorsement
Lesson 6-1, page 127
COMPLETED CHECK STUB AND CHECK
1
2
7
3
4
8
9
10
11
12
5
6
Preparing check stubs
1. Write the amount of the check.
2. Write the date of the check.
3. Write to whom the check is to
be paid.
4. Record purpose of the check.
5. Write the amount of the check.
6. Calculate the new account
balance.
Preparing checks
7. Write the date.
8. Write to whom the check is
to be paid.
9. Write the amount in figures.
10. Write the amount in words.
11. Write the purpose of the
check.
Lesson 6-1, page 128-129
12. Sign the check.
RECORDING A VOIDED CHECK

1
2
4
3
5
1. Record the date.
2. Write the word VOID in the account title.
3. Write the check number.
4. Place a check mark in the Post. Ref. column.
5. Place a dash in the Cash Credit column.
Lesson 6-1, page 129
Work Together &
On Your Own –
Page 130
TERMS REVIEW
bank statement
Lesson 6-2, page 135
TERMS REVIEW
Bank Statement
A report of deposits, withdrawals,
and bank balances sent to a
depositor by a bank.
Lesson 6-2, page 131
BANK STATEMENT
Lesson 6-2, page 131
BANK STATEMENT RECONCILIATION
1. Date
1
2. Check Stub
Balance
3. Service Charge
4. Adjusted
Check Stub
Balance
2
5
3
6
7
8
5. Bank Statement
Balance
6. Outstanding
Deposits
7. Subtotal
9
4
10
8. Outstanding Checks
9. Adjusted Bank Balance
Lesson 6-2, page 132
10. Compare Adjusted Balances
RECORDING A BANK SERVICE CHARGE ON A CHECK
STUB
1. Write Service
Charge.
2. Write the amount of
the service charge.
3. Calculate and
record the new
subtotal.
1
2
3
Lesson 6-2, page 133
JOURNALIZING A BANK SERVICE CHARGE
1
2
4
3
1. Write the date.
2. Debit Miscellaneous Expense.
3. Credit Cash.
4. Write the source document number.
Lesson 6-2, page 134
Work Together &
On Your Own –
Page 135
TERMS REVIEW
dishonored check
electronic funds transfer
debit card
Lesson 6-3, page 140
TERMS REVIEW
Dishonored Check
A check that a bank refuses to
pay.
Lesson 6-3, page 136
TERMS REVIEW
Electronic Funds Transfer (EFT)
A computerized cash payments
system that uses electronic
impulses to transfer funds.
Lesson 6-3, page 138
TERMS REVIEW
Debit Card
A bank card that, when making
purchases, automatically deducts
the amount of the purchase from
the checking account.
Lesson 6-3, page 139
RECORDING A DISHONORED CHECK ON A CHECK
STUB
1. Write Dishonored
Check $50.00.
2. Write the amount of
the dishonored check.
3. Calculate and
record the new
subtotal.
1
2
3
Lesson 6-3, page 136
JOURNALIZING A DISHONORED CHECK
November 29. Received notice from the bank of a dishonored
check from Learn N Play, $35.00, plus $15.00 fee; total, $50.00.
Memorandum No. 55.
2. How is each account classified?
Accounts Receivable—Learn N Play is an
asset account.
Cash is an asset account.
3. How is each classification changed?
Assets are increased.
Assets are decreased.
4. How is each amount entered in the accounts?
Assets increase on the debit side.
Assets decrease on the credit side.
Accounts Rec.—Learn N Play
Debit
Normal Balance
50.00

Cash
Debit
Normal Balance
50.00

1. Which accounts are affected?
Accounts Receivable—Learn N Play
Cash
Lesson 6-3, page 137
JOURNALIZING A DISHONORED CHECK
4
3
1
2
1. Write the date.
2. Debit Accounts Receivable—Learn N Play.
3. Credit Cash.
4. Write the source document number.
Lesson 6-3, page 137
JOURNALIZING AN ELECTRONIC FUNDS TRANSFER
4
3
1
2
1. Write the date.
2. Debit Accounts Payable—Kelson Enterprises.
3. Credit Cash.
4. Write the source document number.
Lesson 6-3, page 138
JOURNALIZING A DEBIT CARD TRANSACTION
4
3
1
2
1. Write the date.
2. Debit Supplies.
3. Credit Cash.
4. Write the source document number.
Lesson 6-3, page 139
Work Together &
On Your Own –
Page 140
TERMS REVIEW
petty cash
petty cash slip
Lesson 6-4, page 144
TERMS REVIEW
Petty Cash
An amount of cash kept on hand
and used for making small
payments.
Lesson 6-4, page 141
TERMS REVIEW
Petty Cash Slip
A form showing proof of a petty
cash payment.
Lesson 6-4, page 142
ESTABLISHING A PETTY CASH FUND
August 17. Paid cash to establish a petty cash fund, $200.00.
Check No. 8.
Petty Cash
2. How is each account classified?
Petty Cash is an asset account.
Cash is an asset account.
3. How is each classification changed?
Assets are increased.
Assets are decreased.
4. How is each amount entered in the accounts?
Assets increase on the debit side.
Assets decrease on the credit side.
Debit
Normal Balance
200.00

Cash
Debit
Normal Balance
200.00

1. Which accounts are affected?
Petty Cash
Cash
Lesson 6-4, page 141
ESTABLISHING A PETTY CASH FUND
4
3
1
2
1. Write the date.
2. Debit Petty Cash.
3. Credit Cash.
4. Write the source document number.
Lesson 6-4, page 141
MAKING PAYMENTS FROM A PETTY CASH FUND WITH
A PETTY CASH SLIP
Lesson 6-4, page 142
REPLENISHING PETTY CASH
4
3
1
2
1. Write the date.
2. Debit Miscellaneous Expense and Advertising Expense.
3. Credit Cash.
4. Write the source document number.
Lesson 6-4, page 143
Work Together &
On Your Own –
Page 144