Question

is from on't im- start at can - neces- 3. Suppose you haven't paid attention to the balance in your checking a begin to overdraw the account. Assume you had $200 in your account on morning and make the following charges over the weekend: checking account and you $200 in your account on Friday through as Saturday $10 IHOP $35 Mobil Sunday $85 Woodman's ell as e in Friday $100 ComEd $150 Book Store $15 Pizza Hut $20 ATM $20 AMC Theater Your bank charges a $5 overdraft fee for each item (up to four per day) if your ac count is overdrawn. There is also a consecutive-day overdraft fee of $5 per day for each day your account is overdrawn after the first day. a. If the charges go through in the order listed, calculate your balance at the end of each day.

Answer 1

1.

	Friday
Balance	200
Less: COmEd	100
	100
Less: Book Store	150
	-50
Less: O/D charge	5
	-55
Less: PizzaHut	15
	-70
Less: O/D charge	5
	-75
Less: ATM	20
	-95
Less: AMC Theater	20
	-115
Less: O/D charge	5
Balance on Friday	-120

	Saturday
Balance on Friday	-120
Less:IHOP	10
	-130
Less: OD Charge	5
	-135
Less: Mobil	35
	-170
Less: OD Charge	5
	-175
Less: Consecutive OD Charge	5
Balance on Saturday	-180

	Sunday
Balance on Saturday	-180
Less:Woodman	85
	-265
Less: OD Charge	5
	-270
Less: Consecutive OD Charge	10
Balance on Sunday	-280

2. Using the below processing order on Friday will save you an OD charge of $10 .

	Friday
Balance	200
Less: COmEd	100
	100
Less: PizzaHut	15
	85
Less: ATM	20
	65
Less: AMC Theater	20
	45
Less: Book Store	150
	-105
Less: O/D charge	5
Balance on Friday	-110

For Saturday and Sunday the OD charges will remain same and hence the order of processing is irrelevant since the account is overdrawn on Friday itself.

3. You can save an OD charge of $10 by transferring $150 as shown below:

	Saturday
Balance on Friday	-120
Transfer	150
	30
Less:IHOP	10
	20
Less: Mobil	35
	-15
Less: OD Charge	5
Balance on Saturday	-20