Financial Records

Keeping Good Financial Records

Instructional Objectives: Students will learn the basics of how to keep good financial records. Students will gain an initial understanding as to the difference between debit and credit cards and how debit cards affect the balance.

Time Required: one to three hours

Advance Preparation: If possible obtain copies of checkbooks, make copies of checkbooks or have one computer per student and Microsoft Excel installed on each machine. If possible, scan a picture of a checkbook ledger to show on the projector or tvator connected to a television. Go to http://usd.edu/trio/tut/excel/checkbook.html and download a copy of an excel checkbook. If your school does not have internet access, you may want to save the webpages (I prefer using Netscape for this) or use WebWhacker to copy the pages onto a disk. If you are going to do the Fed 101Today, make sure that you have the Flash plugin installed on the computers. You could also do the html version which does not require Flash, but it is not as animated.

Materials / Resources Required: Internet access, a projector, checkbooks or copies of a checkbook ledger

Vocabulary: debit, credit, ledger, expenses, petty cash, budget, balance, expenditures

Concepts, Focus Questions (and responses), Generalizations, Key Points: What are debits and credits and how do they affect a checkbook ledger? Students must understand that debits decrease the balance in a checkbook. Credits increase the balance in a checkbook. Students must clearly understand all vocabulary presented in this lesson. It is the foundation for the rest of the unit. Emphasize to students that you must keep records of all transactions that affect the checkbook including ATM cards, without this, your records are not accurate. Explain the difference between Debit cards and Credit cards, that the first is money that you actually have and that the second is money that is "loaned" to you at a certain percent. Students must understand that debit cards take money out of your balance just like a check does with the difference that a debit card does not get a check number. Note to students that purchases made with a debit card is not protected, while some credit cards offer buyer protection and at the end of the month you are sent a statement with all your purchases during the billing cycle.

Procedures:

Give students and overview of what they will be doing in the unit.
Explain to students the importance of good financial recordkeeping. (Use this site as a reference, if needed http://ianr.unl.edu/pubs/homemgt/ )
If you are in a computer lab with internet access, take students to http://ianr.unl.edu/pubs/homemgt/nf5.HTM Money management record keeping page. If you are in a class with only port for internet access, then connect the projector and use it to guide students through the web page.
Go over the different money management systems. After you finish going over all the money management systems, tell the class that you will be concentrating on the checkbook system. Reinforce to the class that although you will be working on the checkbook system, in life you may be using one or more of these systems.
Explain to the class, the different parts of a checkbook.
Take students to the following website http://usd.edu/trio/tut/excel/checkbook.html This is a good site that explains step by step how to setup a checkbook in Excel.

Activities: Students can be given a mock exercise to use the checkbook. Students can also visit the Fed 101 The Federal Reserve Today at http://kc.frb.org/fed101/indexflash.cfm and click on the Checks Mystery

Extensions or Follow-up: Ask students to write 3 examples each of debits, credits, expenditures or give students a list of 15 or 20 transactions and ask them to classify them as debits or credits. For example, an income tax refund check for $200 is it a credit or a debit for me (credit), what about for the IRS (debit)?

Homework: Write three uses for petty cash.

Tips: Explain to students the concept of a "Wild Check" where you carry a blank check with you in case of an emergency and you can't carry your checkbook with you. I use the story of them going to a DMX concert and they brought enough money for some food and transportation and you have a "wild check" for anything that might come up. At the end of the concert, you find out that the new DMX sweater you were going to buy in the store for $35 is selling for $20 at the concert. You write the check out and write down on a piece of paper the amount and who it was made out to. When you get home, you register the information on the checkbook. You may also want to give students transactions to register in their mock Excel checkbook. This serves as a practice for the exam as well as for the real world. If you have a Debit and Credit cards on hand, you may want to show students that they look the same. Make sure to keep your card numbers covered while showing to students. If you are concerned, scan the cards and use a program like Adobe Photoshop or Paintshop Pro to cover or blot out your info. You can also scan one of your checks and do the same.

Click on the bag of money to return to the Main Menu

Last modified 2/3/02 by Anthony Salcedo

TGBTG