What Does It Mean?

Match the terms associated with managing your cash and savings accounts on the left with the descriptions of the terms on the right. Read each description carefully and type the letter of the description in the Answer column next to the correct term.

Hint: These are not necessarily complete definitions, but there is only one correct answer for each term.

Term

Answer

Description

Compound interest H A$.$ This form of check also often called a banker$$s check payable to a third party is drawn by the bank$$s own funds in exchange for the amount specified in the check, plus, in most cases, a service fee.

Demand deposit J B$.$ This is a deposit held in a financial institution for which funds are deposited for periods longer than demand deposits.

Overdraft C$.$ This is the term applied to the normal, day$-$to$-$day administration of an individual$$s or family$$s cash and near$-$cash, or liquid assets.

Account reconciliation D$.$ This refers to an insurance program that protects depositor funds against the failure of the insured depository institution.

Cash management E$.$ This is the phrase used to describe a savings account that pays interest only on the investor$$s deposited funds and not on previously earned interest.

Deposit insurance F$.$ These financial institutions, such as commercial banks, savings banks, and credit unions, are authorized to accept deposits.

Cashier$$s check G$.$ This is the condition that results when an account holder withdraws more money than is currently in the account.

Time deposit H$.$ This is the name applied to interest earned on the initial deposit amount plus the previously earned interest.

Simple interest I. This is the process of comparing the balances in the bank$$s records with those in the account holder$$s ledger to identify possible errors in recording checks or deposits.

Depository institution J$.$ Funds held in this type of account $($also called a checking account$)$ must be honored, or paid, by the depository institution immediately upon demand by the account holder.