Final answer:
The income statement account titled for recording discrepancies in petty cash is 'Cash Over and Short'. A check is written for payment, and the store gets the money after processing. An overdraft is when expenses exceed the account balance.
Step-by-step explanation:
An income statement account that is used to record cash overages and cash shortages arising from petty cash transactions or from errors in making change is titled Cash Over and Short. It is a means to track discrepancies between the cash on hand and the expected amount, which could arise due to mistakes or mishandling of cash transactions.
To use a check for payment for goods and services, you need to write the check for the amount owed to the payee, who then deposits or cashes it at their bank. The store or entity gets the money when their bank processes the check and deposits the funds into their account.
An overdraft occurs when an individual writes a check for an amount greater than what they have in their account, resulting in a negative balance unless there are sufficient overdraft protections in place.