If you deposit a $50 check in the bank, before the check has cleared the change in your bank's balance sheet will be a

Question

Quizplus · Accepted Answer

When a $50 check is deposited, the bank credits the customer's account with the $50, creating a $50 increase in checkable deposits. However, since the check has not yet cleared, the bank considers it a cash item in the process of collection, which also increases by $50. The bank's reserves do not change until the check has cleared, so there is no increase in reserves. Therefore, choice C is the correct answer.

If You Deposit a $50 Check in the Bank, Before