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<p>Bank overdraft is a form of financing in which the bank honors presented checks even when there is no balance in the business account which results in negative balance in the bank account.</p>
(book bank overdraft) which represent situation in which the balance as per cash book is negative while the balance as per bank book is positive. It arises when the checks written exceed the bank balance available thereby resulting in negative bank balance in books but since those checks are not yet presented so the bank balance is not negative and there is no 'actual bank overdraft'.
Book Overdraft is a situation when a company issues checks in excess of what the bank balance is, but those checks have not been presented for clearance to the bank yet. Thus, this is an overdraft on the company books.
