Question

Shakira has a balance of $202.86 in her checking account on Saturday morning. She uses her debit card to pay her cell phone bill of $80.73 over the phone. She then picks up her dry cleaning, dog food at the pet store and groceries for debits of $16.89, $35.24, and $113.92. Shakira’s bank uses a balance system of deducting highest transactions first. The bank will not return amounts up to a total of $50 in overdrafts, but they do charge a fee for each overdraft. How many overdraft fees will Shakira incur?
a.
1
b.
2
c.
3
d.
4


Please select the best answer from the choices provided

A
B
C
D

Answer 1

Order the debits from largest to smallest (bank deducts highest first): 113.92, 80.73, 35.24, 16.89.

Start with $202.86:
- After $113.92 → $88.94 (positive)
- After $80.73 → $8.21 (positive)
- After $35.24 → $8.21 − $35.24 = −$27.03 (first overdraft → 1 fee)
- After $16.89 → −$27.03 − $16.89 = −$43.92 (still within $50 limit but another overdraft → 2nd fee)

Two transactions cause overdrafts, so she incurs 2 overdraft fees.

Answer: B