Final answer:
A cheque is a payment order from the drawer to the payee. The drawer must have sufficient funds, and the store receives payment through their bank. An overdraft occurs if the cheque amount exceeds the drawer's account balance.
Step-by-step explanation:
A cheque is a written, dated, and signed instrument that directs a bank to pay a specific sum of money to the bearer or to a person whose name the cheque has been issued. The person who issues the cheque is the drawer; the person who is to receive the payment or to whom the cheque is payable is the payee.
To use a cheque for payment for goods and services, the drawer needs to have a checking account with sufficient funds. When the cheque is given to a store, the store deposits it into their bank account. The bank then processes the cheque and transfers the amount from the drawer's account to the store's account. If the drawer does not have enough money in their account to cover the cheque, an overdraft may occur, which means withdrawing more money than the account holds, often resulting in a fee.