Let this simple balancing a checkbook lesson help you develop quality recordkeeping and check register habits – a must in business.

In the preceding page of this balancing a checkbook lesson, you started the actual balancing process. Now, let’s complete the process.

Step 10: compare and match up the electronic withdrawals on your bank statement and register book.

Check off each withdrawal on the statement and in the clr’d column as you match up the date and dollar amount. You should have cleared a total of 12 electronic withdrawals, according to your bank statement (Exhibit N; see #10 on image 3) (Exhibit O; see #10).

However, in our example, our register is missing an ATM withdrawal, and you will have to add it to the end of your register as we did in step seven. In this case, you will enter the transaction as “?????” because you will have to find the receipt, and reconstruct what was paid for with the cash.

Step 11: add a missing ATM transaction in your check register of $185.00 on January 30th.

Add it to the end of your register. Date it January 30th, and check it clr’d on the register. Then mark it as “added” to your statement (Exhibit P; see #11 on image 3) (Exhibit Q; see #11 on image 4).

Electronic withdrawals should be watched carefully as they are perhaps the easiest way for someone to fraudulently obtain cash from your account. If you use an ATM card or a debit card, keep it locked up and never share the pass code.

Step 12: reconcile the other withdrawals group on your bank statement.

This group usually includes the monthly account service charge and any other miscellaneous transactions, such as returned deposits, ATM fees, etc.

These transactions have to be added to the end of your check register book as we did in steps 6 & 11 (Exhibit R; see #12 on image 3) (Exhibit S; see #12 on image 4).

Step 13: working with the back of your bank statement (Exhibit A), enter all of the deposits that don’t appear on your statement and aren’t checked off as being cleared on your check register.

In our example, there was only one deposit in your check register book (Exhibit T; see #13 on image 3) (Exhibit U; see 13A).

Important note: In this step and with step 15, you are adding back all of the transactions that occurred after the statement was printed on January 31, 2010.

After you enter all of the deposits into your check register book, you must total them (Exhibit U; see 13B).

Step 14: input any withdrawals that occurred after the statement closing date of January 31, 2010 on the back of your bank statement (Exhibit V; see #14 on image 3 and 4) (Exhibit W; see 14A).

After you enter all of the withdrawals, you must total them to see if you have been accurately balancing a checkbook (Exhibit W; see 14B).

Step 15: compare your check register balance and the bank statement balance to see if they actually match.

This requires you to find the ending balance on your statement, and enter it on the back of your statement.

Next, you will carry the totals for your deposits and withdrawals listed on the back of the statement to the lines below – just follow the lines on your bank statement (Exhibit X; see #15).

Step 16: read the instructions for final steps in balancing a checkbook.

• Add the deposits ($1,589.25) to your ending balance ($877.07) to get a subtotal of $2,466.32 (Exhibit Y; see 16A).
• Subtract the checks and withdrawals ($1,977.21 from your subtotal of $2466.32) and you should get a balance of $489.11 (Exhibit Y: see 16B).

That concludes the balancing a checkbook lesson. Hopefully, you will now have a better understanding of how to maintain an accurate check record book. Doing so is critically important for cash flow purposes.

Struggling to meet your cash flow needs? Apply online now for a cash flow management solution.

Need a refresher? You’ll appreciate the balancing a checkbook overview.