Business College Ch 14 TEST 3
Fiona writes a check "pay to the order of Gerri" drawn on Fiona's account at Home & Farm Bank. Gerri presents the check for payment to Home & Farm, which accepts it. Primarily liable on the check is
Home & Farm.
To finance the purchase of a house from Tuna, Uri signs an instrument promising to pay to "Verity Mortgage Service" $160,000 with interest in installments with the final payment due July 10, 2045. To be negotiable, this instrument must include the signature of
Uri.
Barry draws a check payable to "Cash" and presents it to Dollars & Sense store for payment. This instrument is
a bearer instrument.
Avril receives a payroll check from Business Solutions, Inc., and indorses it by signing her name on the back of the check. This is
a blank indorsement.
Gwen deposits $6,000 with Hearthstone Bank on July 1, 2016. Hearthstone promises to repay Gwen the $5,000 plus 2 percent annual interest on July 1, 2021. Hearthstone issued to Gwen
a certificate of deposit.
O'Malley negotiates an order instrument to Phil by
a delivery to Phil with any necessary indorsement.
Petra signs a check payable to Quentin, who indorses the back, gives it to Regional Credit Union (RCU), and receives cash. The transfer of the check from Quentin to RCU is
a negotiation.
Emily writes and signs a check payable to "Festival Cinema." Georg, Festival's manager, indorses the check "For deposit only." This is
a restrictive indorsement.
Erin draws a check payable to "Foodland" to buy groceries. Refer to Fact Pattern 14-1. Erin's check is most likely
an order to pay.
Builders Exchange, Inc., issues an instrument in favor of Custom Construction Company. For the instrument to be negotiable, it must
be payable on demand or at a specific time.
Brad, the owner of Clear Cut Corporation, signs an instrument that includes the phrase "payment for this note will be made from the proceeds of next year's timber sale." This instrument is
negotiable.
Bernice signs a promissory note for $1,500 in favor of Community College. The note is undated but specifies that it is "payable one month after date." This note is
not negotiable, because the maturity date cannot be determined from the face of the instrument.
Talia, who is not a Urban Bank customer, attempts to cash a check drawn on the bank. The check is considered dishonored if Urban Bank
refuses to pay it.
On the back of a check payable to Nero, Nero writes "Pay to Odell, without recourse" and signs it. This
relieves Nero of liability on the check.
LNG Corporation and Midstates Utility Company enter a contract for a sale of liquefied natural gas. LNG draws a draft unconditionally ordering Midstates Utility to pay $50,000 to LNG's order in sixty days. Midstates Utility signs and dates the draft.
the drawer.
Erin draws a check payable to "Foodland" to buy groceries. Refer to Fact Pattern 14-1. With respect to Erin's check, Foodland is
the payee.
