Question

If Mick writes a check on his San Francisco bank to Greg who deposits it in his Cleveland bank, how does the Cleveland bank collect the money represented by the check drawn against the San Francisco bank

Answer 1

The above statement justifies the deposited money will enter the common forum "Federal Reserve System"

Checks, drafts, and other equity devices are processed through a national check clearing system run by the Federal Reserve System.

When checks drawn on other institutions are deposited in a depository institution, the institution may transmit the checks to a Federal Reserve Bank for collection.

For checks collected through the Federal Reserve Banks, the value of the checks deposited for collection is credited to the collecting institutions' accounts, and the value of the checks submitted for payment is deducted from the accounts of the paying banks.

The majority of checks are obtained and paid within one business day.

Learn more about Federal Reserve Bank:

https://brainly.com/question/13038482

# SPJ1