A business writes a check to a supplier. However, there is an accounting error that the business owner is unaware of and there is not enough money in the account to cover the check. What is the best strategy for avoiding this problem in the future?

Question

A business writes a check to a supplier. However, there is an accounting error that the business owner is unaware of and there is not enough money in the account to cover the check. What is the best strategy for avoiding this problem in the future?

a. Switch to using cash for all business transactions.
b. Assume it was a one-time problem and keep taking checks.
c. Insist on electronic payments so there is less opportunity for error.
d. Stop doing business with this client since the client committed a crime.

Answer 1

c. Insist on electronic payments so there is less opportunity for error.

By using electronic payments, such as direct transfers or online payment systems, the business can ensure that the funds are available and that there is less room for accounting errors. This can help prevent the issue of writing checks without sufficient funds in the future.