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FABM 2
Quarter 4 – Module 3-4
Checks and Contents of a Bank
Statement

Subject Teacher : GALA C. GALERA

Writer: Bb. Boy Jonnel C. Diaz
 I

This module presents a discussion about how to prepare a check and a bank statement.
It aims to introduce to the learners the basic concepts and ideas in writing a check and
understanding the content of a bank statement.

The learning activities and tasks in this module are provided in order to test their
understanding and evaluate independent learning.

Hence, this module will be useful as reference guide for the ABM students as they will
continue to be equipped with the knowledge and skills needed for their business career.
Content Standard:

The learner demonstrates an understanding of the types of bank accounts, basic

transactions, and documents related to bank deposits and withdrawals.

Performance Standard:

The learner is able to share samples of bank account forms and documents in class and
discuss their uses and importance.

Learning Competencies:
1. Identify and prepare checks.
2. Identify and understand the contents of a bank statement..

Objectives:

1. Write the entries of a sample check and bank statement correctly.

2. Determine the correct placement of a bank statement and entries content.
3. Demonstrate appreciation on preparing checks and reviewing the contents
of a bank statement which can be useful in the real life situations.

2
Pre-Assessment:

Direction: Read and analyze statements below. Determine whether the statement is TRUE
OR FALSE. Write TRUE if the statement is correct and write FALSE if otherwise. Write
your answer on your activity notebook.

1. Bank statements contain information from the thirty business days.

2. It is not important to include the date when writing a check.
3. If the bank makes a mistake, you should inform your bank immediately, no
matter how tempting it is not to do so.
4. Bank check is safer for payment.
5. A bank statement only shows money going out of your account.
6. Figures under the credit column of a bank statement represents all charges or
deductions made by the bank to your account.
7. When you receive a bank statement, it is very important that you check the
entries to be sure that there are no mistakes or missing items.
8. In the Philippines, issuing a check with insufficient bank balance is a criminal
offense under Batas Pambansa Blg. (BP) 22 or the Banking Checks Law.
9. It is okay to use a pencil or marker when writing a check.
10. Bank statements can be used to judge an individual or a company’s worth or
standing as well as for purposes of business.
11. A bank statement is a list from the bank for services rendered to the client.
12. A check is an instrument issued by a person in payment for goods and services.
13. Don’t sign a check until after you have filled in the name of the payee and the
amount.
14. In the Philippines, a check becomes stale if it exceeds five (5) months from the
date of the check.
15. Bank statements are generally prepared by the bank for the account holder at
the beginning of each month.

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 Lesson
1 Pre paring Chec ks

Checks can be used to make bill payments, as gifts, or to transfer sums

between two people or entities. They are generally seen as more secure way of
transferring money than cash, especially when there are large sums involved.

’s In

Task 1

Direction: Discuss briefly your insight about the picture below. Write your
explanation on your activity notebook.
Guide questions:
• Why do companies issue checks?
• Why is a bank check a commonly used form of payment?

Source: www.google.com/safety

Source: Crushpixel.com

Source: Dreamstime.com
Source: google.com/convenience
Source: paissabazaar.com

4
 ’s New

Task 2
Direction: Below is a sample check. Supply the missing items to complete the sample check.
Choose your answers from the choices inside the box. Write only the LETTERS.

A. D. March 26, 2014

B. 1,000.15 E. Toto Dela Cruz

C. One Thousand and 15/100 pesos only.

1.

2. 3.

4.

5.

Source: www.philippineproperties101.com.ph
 is It

Countless consumers and businesses continue to see value in using checks

rather than other payment options. As the amount paid in transaction increases, so
does the desire for the level of financial control and management that checks
provide. The security, peace of mind and evidence of payment offered by checks
continues to make them preferred way to pay in many types of transactions.
Compared to bills and coins, it is very easy to prepare, safe and convenient in
making payments. Bank procedures give protection to checks. Stolen or loss bills
are difficult, if not impossible, to recover. On the other hand, banking procedures
ensures that the check payments are made only to the designated payees.
Moreover, the check itself is an evidence of payment. Once the bank had paid the
check, it is normally returned to the account holder for record keeping.

Check

▪ A document that orders a bank to pay a specific amount of money

from a person’s account to the person in whose name the check has
been issued.
▪ Type of bill of exchange and was developed as a way to make
payments without the need to carry large amounts of money.
▪ It should be covered by sufficient balance in the issuer’s checking
account.

*In the Philippines, issuing a check with insufficient bank

balance is a criminal offense under Batas Pambansa Blg. (BP) 22 or
the Bouncing Checks Law.

(Ong & Gomendoza, 2017)

The Parties Involved in The Issuance of a Check:

▪ Drawer - the person or entity who make the check

▪ Payee - the recipient of the money
▪ Drawee - the bank or other financial institution where
the check can be presented for payment

Types of Check:

1. Cross Check
▪ It is marked to specify an instruction about the way it is to be
redeemed.
▪ Usually done by writing two parallel lines on the upper left
portion of the check.
▪ Cannot be encashed over the counter by the payee .
▪ It should be deposited to the payees account.
 2. Stale Check
▪ A check which a bank will not accept and exchange for money
or payment because it was written more than a certain number
of months ago.
▪ In the Philippines, a check becomes stale if it exceeds six (6)
months from the date of the check.

3. Post – Dated Check

• If a check bears a date which is yet to come (future date)
• Cannot be honoured earlier than the date of the check

How to Write a Check:

1. Current date: On the line on the upper right beside the word date,
write the date of the check. In most cases, you’ll use today’s date,
which helps you and the recipient keep accurate records.

2. Payee: Write the complete name of the payee or recipient on the line
beside the words “Pay to the Order of”. When the check is intended
to be encashed by just any person, the word “cash” can be written
instead of the name of a person. If the payee or recipient is an
organization or company, write the complete name of the
organization or company.

3. Amount in numeric form: Write the exact amount of the check

beside the peso sign.

4. Amount in words: Write the exact amount of the check in words on

the line beside the word Pesos. Write the word “only” after the
amount so that nothing can be written after the amount.

Example: Twenty Thousand

Instead of writing Twenty Thousand, write Twenty Thousand only so

that nothing can be written after the words Twenty Thousand.

5. Signature: Sign the check l e g i b l y on the line at the bottom- right

corner. Use the same name a n d signature on file at your bank. This
step is essential – a check will not be valid without a signature.
 Figure 1. Sample check
DATE
DRAWE
R

AMOUNT
PAYE Source: www.philippineproperties101.com.ph

E IN
NUMERIC

AMOUNT IN
SIGNATURE
WORDS
DRAWE
E

’s More

Task 3

Direction: Below is a blank check. Write the check based on the following
assumptions:

a. You are Joey Lao, the customer of ABM Furniture.

b. The date today is January 20, 2021.
c. You are purchasing a table from ABM Furniture in the amount of
₱ 25,000.
d. You are going to issue a check dated today in payment for the table you just
purchased.
 Source: www.philippineproperties101.com.ph

Explore!

▪ How did you find the activity?

▪ Was it easy/hard to prepare a check?

▪ Do you think you are ready to make payments using a check in the
future?

I Have Learned

Task 4

Direction: In your activity notebook, complete the following: (5 points each).

1. As an ABM student, I have learned that

.

2. As an ABM student, I have realized that

.

3. As an ABM student, I will apply what I have learned

.
 I Can Do

Task 5

Direction: Do what is asked. Write your answer on your notebook.

1. How do you write a check?

2. What are the responsibilities involved when using checks?

3. Explain briefly the importance of using a check instead of cash.

ESSAY RUBRIC
Level of Achievement General Approach Comprehension
Exemplary •Addresses the question. •Demonstrates an accurate and complete
(15 pts quizzes) •States a relevant, justifiable understanding of the question.
answer. •Backs conclusions with data and
•Presents arguments in a logical warrants.
order. •Uses 2 or more ideas, examples and/or
arguments that support the answer.
Adequate •Does not address the question •Demonstrates accurate but only adequate
(10 pts quizzes) explicitly, although does so understanding of question because does
tangentially. not back conclusions with warrants and
•States a relevant and justifiable data.
answer. •Uses only one idea to support the answer.
•Presents arguments in a logical •Less thorough than above.
order.
Needs Improvement •Does not address the question. •Does not demonstrate accurate
(5 pts quizzes) •States no relevant answers. understanding of the question.
•Indicates misconceptions. •Does not provide evidence to support
•Is not clearly or logically their answer to the question.
organized.
No answer (0 pts)

Please check below. Lesson 2.

Lesson
2

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Lesson 2 : UNDERSTANDING THE STATEMENT OF BANK STATEMENT

Task 1

Direction: Arrange the jumbled letters to form the correct word/s. Write your answer on your
answer sheet.

1.
It represents all charges or deduction made by the bank to your account.

2.
It indicates the details of the check paid by the bank.

3.
Represents the deposits or additions to your account that was made by the bank.

4.
This is normally a bank code for the transactions.

5.
Indicates the date the transaction was made.
 is It

At the end of every month, the bank furnishes a statement to the depositor showing
the movement of the account. It contains all the withdrawals, deposits and balance of your
account after every transaction. It may also indicate bank charges that were deducted by the
bank automatically. Also, interest earned by the bank is likewise reflected.
Bank statements provide a clear, ongoing picture of your financial activity. By
reviewing your statements, you can monitor your spending and savings while watching for
any errors. Most importantly, being mindful of your finances will help you reach your goals
and achieve financial well-being.

Bank Statement

▪ Detailed transaction history of the account over the reporting period.

▪ A report prepared by the bank for those accounts that do not have passbooks.
▪ Usually sent by the bank through courier services together with the debit and
credit memos and the cancelled checks.
▪ Account holders can access to and print their transaction history 24/7 and on
real time basis.

Bank statement entries:

Date column
- indicates the date the transaction was made
Check number
- indicates the details of the check paid by the bank
Transaction code
- normally a bank code for the transactions
Debit column
- represents all charges or deduction made by the bank to your
account
Credit column
- represents the deposits or additions to your account that was made by the bank
Balance column
- is the running balance after considering the effect of the transaction to your account.
Samples of Debit transaction

• Bank service charge - monthly fee charged by the bank for its services (Ex. cost of
printing checks writing funds to other locations and other fees)
• NSF - (Non Sufficient Fund) – Banks also use a debit memorandum when a
deposited check from a customer “bounces” because of insufficient funds. Nowadays bank
refer to this as DAIF (Drawn Against Insufficient Fund) or DAUD (Drawn Against
Uncleared Deposits)

Samples of Credit transactions

• Collection of cash proceeds from notes receivables.

• Interest income earned by the deposit.

As part of control, the bank statement received from the bank is compared with the
accounting records of the business. This process is called bank reconciliation. Bank
reconciliation will be discussed in the succeeding chapters.

Together with the bank statements, the banks will include the copies of checks cleared
or paid by the bank for that particular month.

Figure 1. Sample of a Bank Statement.

ABM BANK
San Jose St., Dumaguete
Cardo Dalisay
Perdices St., Dumaguete City
Current Account No. 2030071245
Statement Period: 11/01/20 – 11/30/20

DATE CHECK TRANS CODE DEBIT CREDIT BALANCE

NO.

11/1/20 Balance Forwarded 44,200.00

11/3/20 12345 4,200.00 40,000.00
11/5/20 Deposit 5,000 45,000.00
11/6/20 Interest 500 45,500.00
11/6/20 Wtax 50.00 45,450.00
11/7/20 Bank Service Charge 150.00 45,300.00
11/10/20 12345 5,200 40,100.00
NOTE:
*Bank statements can vary from bank to bank.
*There is no standard format for bank statement.
 ’s More

Task 2

Direction: Use the sample bank statement below to answer the questions. Write your answer
on your activity notebook.

Cardo has just received the statement for his current account with ABM Bank. This is
what his bank statement looks like:

ABM BANK
San Jose St., Dumaguete City
Tel: 1-888-123-4567

Current Account No. 2030071245 Mr. Cardo Dalisay

Statement Period: 12/01/20 – 11/31/20 Perdices St., Dumaguete City

DATE CHECK TRANS CODE DEBIT CREDIT BALANCE

NO.

12/1/20 Balance Forwarded ₱ 40,100.00

12/4/20 #12345 5,000.00 35,100.00
12/4/20 Bank Service Charge 100.00 35,000.00
12/15/20 Employer Pay 1,500.00 36,500.00
12/18/20 Interest 500 37,000.00
12/18/20 Employer Pay 5,000.00 42,000.00
12/21/20 Cell Phone Bill 4,000.00 38,000.00
12/21/20 W / tax 200.00 37,800
12/23/20 Umbrella Insurance Co. 2,000.00 35,800.00
12/29/20 #12345 5,200 ₱ 30,600.00
Questions:

1. What type of account does Cardo have?

2. What was the balance in the account on Dec. 1, 2020?

3. What is the total amount of money deducted from the account on December 4, 2020?

4. On what date(s) did Cardo receive money from his employer?

5. What is the total amount of interest credited to his account?

6. On what date was money withdrawn from the account to pay for a cell phone bill?

7. What is the total number of checks debited to this account during statement period?

8. What is the total amount of money deposited into this account during the statement
period?

9. How much did Cardo pay for the Insurance company on December 23, 2020?

10. How much money in Cardo’s bank account at the end of business on 21st of December
2020?

I Have Learned

Task 3

Direction: In your activity notebook, complete the following: (5 points each)

1. As an ABM student, I have learned that

.

2. As an ABM student, I have realized that

.

3. As an ABM student, I will apply what I have learned

.
ASSESSMENT :

Multiple Choice: Direction: Now that you have finished accomplishing this
module, let us check what you have learned. Choose the letter of the correct
answer and write it on your activity notebook.

1. What word can be written instead of the name of the person when the check is
intended to be encashed by just any person?
A. Any C. Cash
B. Unknown D. Special

2. Mr. Chu Rurut wrote a check for his electric bill. Chu is referred to as
A. the payee C. the drawee
B. the drawer D. the endorser

3. What is the purpose of writing a check?

A. to pay cash C. to represent a status symbol
B. to pay a person or business D. to pay small amount of money

4. A check returned from the bank marked as “NSF” means

A. Non Sufficient Funds C. No Service Fee
B. No Signature Found D. No Stated Fee

5. When you make a deposit, are you adding money or subtracting money into your
account?
A. adding money C. both
B. subtracting money D. none of the above
6. When you make a withdrawal, are you adding money or subtracting into your account?
A. adding money C. both
B. subtracting money D. none of the above

7. Which of the following is the correct word form to write on a check for the amount
₱756.50?
A. seven hundred fifty six and 50/100 pesos B.
seven hundred fifty-six and 50/100 pesos C. seven-
hundred fifty-six and 50/100 pesos
D. seven hundred fity-six and 0.50 pesos
8. How is the amount written on a check?
A. words only C. Roman numbers
B. numbers only D. words and numbers

9. Julieta Perez had a balance of ₱2,500.00 in her checking account on January 1, 20xx.
On January 10, 20xx, she wrote a check to Jovi’s Hair Salon for ₱750.00. What is her
new balance?
A. ₱3,250.00 C. ₱1,700.00
B. ₱1,750.00 D. ₱3,200.00

10. Which of the following is not something that you fill out on a check?
A. your signature C. your birthdate
B. the date D. who the check is made payable to
11. Irvin Timtim received a bank statement showing the following amounts. What is the
present balance?

Previous balance : ₱ 453.2

Deposits : 449.00
Checks : 456.01
Service Charge : 2.34
Interest Earned : 2.98

A. ₱446.84 C. ₱456.98
B. ₱453.98 D. ₱543.00
 12. Which of the following is a good check writing practice?
A. writing in pencil
B. writing in pen
C. writing in the middle of the legal line rather than starting at the left margin
D. leaving blank lines on your check

13. This is a written order to a bank to pay the amount stated to the person or business
named on it.
A. Safe deposit C. Check
B. Overdraft D. Bank Statement

14. Anna Gong purchased three rolls of wallpaper at Pamela’s Paints for
₱22.50 each. What was the amount of her check, expressed in word?
A. sixty-seven 50/100 pesos C. twenty-two and 50/100 pesos
B. sixty seven and 50/100 pesos D. sixty-seven and 100 pesos

15. A statement issued by a bank describing the activities in a depositor’s checking

account
during the period.
A. Bank Check C. Deposit Slip
B. Financial Statement D. Bank Statement

DIRECTION: Give your thoughts on the statement below. Write your answer
on your activity notebook. (10 pts.)

“In maintaining transparency and smooth transactions, a bank

statement is invaluable.”
References

Books:
Salazar, D. 2017. Fundamentals of Accountancy, Business and
Management 2. First Edition. Sampaloc, Manila: Rex Book Store, Inc.

Gomendoza, J., et al. 2017. Fundamentals of Accountancy, Business and

Management 2. South Triangle, Quezon City: C & E Publishing, Inc.

Online Sources:

Department of Education. Fundamentals of Accountancy, Business and

Management – Grade 12: Teacher’ Guide1st ed. 2016, 120-123.

Bank Statements. Retrieved on January 25, 2021 from

https://quiziz.com

Bank Statement. Retrieved on January 25, 2021 from

https://mint.intuit.com

Check. Retrieved on January 22, 2021 from

www.Investopedia.com

Check & Crossing. Jaiswal, I. Retrieved on January 22, 2021 from

https://slideshare.net/mobile/

Check Writing Quiz. Retrieved on January 25, 2021 from

https://qui ziz.com

How to Write a Check. Retrieved on January 25, 2021 from

www.balance.com

Making a Bank Statement. Retrieved on January 25, 2021 from

https://m oneymatters.ccpc

END

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