Final answer:
The statement that the first step in handling a customer's bounced check is deleting the original deposit is False. The first step in handling a customer's bounced check is not deleting the original deposit but rather contacting the customer to notify them of the issue. Financial records should only be changed according to proper procedures, and bounced check fees may apply. Accurate transaction recording and customer communication are key.
Step-by-step explanation:
The appropriate first step is to contact the customer who issued the check and inform them about the situation. Financial records, such as deposits, should only be altered or deleted under specific circumstances and following proper accounting procedures. Generally, the reversal of the check should be recorded as a separate transaction to maintain the integrity of the financial records. After notifying the customer, the business must assess any fees associated with the bounced check, and then make arrangements for alternative payment or pursue collection procedures if necessary.
Handling a Bounced Check
To safeguard a company's financial position and maintain accurate records, specific steps must be taken when dealing with bounced checks. These include:
- Notifying the customer about the bounced check promptly.
- Assessing any bounced check fees that will be charged to the customer.
- Recording the bounced check as a transaction in the company's books.
- Attempting to re-deposit the check or seeking alternative payment.
- Considering legal action if the customer fails to make good on the payment.
It is crucial for businesses to have a set procedure for handling non-sufficient funds (NSF) situations to minimize financial risk and confusion within the accounting records.