Final answer:
Cash payments received before a product is completed or delivered are called deposits and progress payments. Using a check requires a bank account with sufficient funds, and stores receive money by processing checks through the banking system. An overdraft is when more money is spent than is available in an account.
Step-by-step explanation:
Cash payments received before a product is completed or delivered are called deposits and progress payments. These payments are common in industries where products or services require a significant amount of time or resources to produce. The payment acts as a commitment from the buyer and helps the seller cover initial costs. For example, a homebuilder may receive progress payments from a customer to cover the costs of materials and labor before the house is completed.
To use a check for payment for goods and services, you need a bank account with sufficient funds, the check itself, and, occasionally, a form of identification. The store where you make a purchase with a check will process it through a banking system to receive the money. An overdraft occurs when you write a check for more than the amount available in your bank account, which can result in additional fees unless you have an overdraft protection service in place.