Placing the practice name and account number on the back of checks is called what?

Placing the practice name and account number on the back of checks is called what?

• A. Petty cash
• B. Endorsing
• C. Accounts payable
• D. Posting

Answer: (B)

Endorsing a check is the act of signing or marking the back of a check to authorize its transfer or deposit. When the practice’s name and account number are written on the back, it directs the bank to credit that specific account, which is a common way to indicate where the funds should go. This helps ensure the deposit is applied to the correct account and identifies the intended recipient. The other terms don’t fit this action: petty cash is cash kept on hand for small expenses, accounts payable are amounts the practice owes to others, and posting is recording transactions in the ledger. Endorsing is the right concept here.

Endorsing a check is the act of signing or marking the back of a check to authorize its transfer or deposit. When the practice’s name and account number are written on the back, it directs the bank to credit that specific account, which is a common way to indicate where the funds should go. This helps ensure the deposit is applied to the correct account and identifies the intended recipient. The other terms don’t fit this action: petty cash is cash kept on hand for small expenses, accounts payable are amounts the practice owes to others, and posting is recording transactions in the ledger. Endorsing is the right concept here.