______________ is the result writing a check for an amount greater than the current account balance.
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A. B. C. D.A
The correct answer is A. Overdrafts.
An overdraft occurs when a customer writes a check or makes a withdrawal from their bank account for an amount greater than the available balance in the account. This results in a negative account balance and the customer is said to be overdrawn.
The bank may honor the check or withdrawal by extending credit to the customer, allowing them to temporarily spend more money than they have in their account. This service is called an overdraft and the bank may charge the customer a fee for providing this service.
An overdraft is essentially a short-term loan from the bank to the customer. The interest rate charged on an overdraft is typically higher than the interest rate on a regular loan, and the overdraft may need to be repaid within a few days or weeks.
Overdraft protection, which is not the correct answer, is a service offered by some banks that allows customers to link their checking account to another account, such as a savings account or a line of credit, to cover overdrafts. If the customer overdraws their checking account, the bank automatically transfers funds from the linked account to cover the overdraft.
The checkbook ledger, also not the correct answer, is a record of all the checks written and deposits made in a checking account. It is used to keep track of the account balance and to reconcile the account with the bank statement.
Therefore, option A, overdrafts, is the correct answer to the question as it describes the result of writing a check for an amount greater than the current account balance.