Accounting Dictionary
Cashiers Check
The bank guarantees that a cashier’s check will not bounce.
If you want to make sure your down payment check for your new house doesn’t bounce, you could go to the bank and pay to have a cashier’s check. Let’s say you have $40,000 in the bank and write a cashier’s check for $35,000. The bank will set aside the $35,000 just for the payment of that check. They guarantee that the check can be cashed. If you wrote another check for $10,000 that hit the bank before the $35,000 check, the bank would bounce the $10,000 because they have guaranteed that the $35,000 cashier’s check can be cashed.
https://accounting.uworld.com/cpa-review/lc/accounting-dictionary/term/cashiers-check/
Sign Up to Learn More!
Join our mailing list today to get notified of new discount offers, course updates, Roger CPA Review news, and more!