What Is an Outstanding Check

question 5

Multiple Choice

What is an outstanding check?

• A)A check that has been issued by the company but has not been presented to the bank for payment.
• B)A check that is guaranteed for payment by the bank.
• C)A check that has been presented to the bank for payment but has not been reported on the bank statement.
• D)A check that was written for an amount that is greater than the balance in the account holder's bank account.

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Definitions:

Compound Annual Rate

The rate at which an investment grows annually when interest is reinvested to earn additional interest.

Nominal Rate

The interest rate before adjustments for inflation or other factors, often referred to as the stated or face interest rate.

Compounded Quarterly

A method of calculating interest where the accrued interest is added to the principal sum every quarter, thus increasing the base for the next interest calculation.

Nominal Rate

The quoted interest rate on a loan or investment, not adjusting for the effect of compounding or inflation.