Test 3 - BLE

O'Malley negotiates an order instrument to Phil by.......... a making an unconditional promise to pay b. a delivery to Phil with any necessary indorsement c. making an unconditional promise to pay d.am assignment of O'malley right under a contract

A delivery to Phil with any necessary indorsements

Ana writes a check to Becky on Ana's account at Community Bank. The bank dishonors the check even though Ana has sufficient funds in her account. The bank is liable to​..... a. Ana b. no one c. the payee on Ana's next check d. Becky

Ana

Builders Exchange, Inc., issues an instrument in favor of Custom Construction Company. For the instrument to be negotiable, it must..... a. be signed by the payee b. be payable on demand or a specific time c. be conditional promise or order to pay d. recite the consideration given in exchange for it.

Be payable on demand or at specfic time

Joni writes Keizer an uncertified check for $500 drawn on Joni's account at Labor Employees Credit Union. Seven months later, Keizer presents the check for payment. The credit union pays the check in good faith without consulting Joni. The credit union...... a. can charge Joni's account for $250 only. b. cannot charge joni's accoutn for any amount c. can charge Joni's account for $500. d. is liable for the breach of contract

Can charge Joni's account for $500.

Tri State Bank agrees to accept a check by setting aside sufficient funds to cover the amount, This check is considered a...... a. certified b. deposited c. cashed d. a provisional credit

Certified

Daisy signs a check "pay to the order of Ewan" drawn on Daisy's account in Finance Bank. Graham forges Ewan's indorsement. Finance Bank pays the check. Most likely​................. a. Daisy will be liable for the amount b. Ewan will have to pay Daisy for the amount c. The federal reserve will reimburse all parties for their costs d. Finance Bank will have to recredit Daisy's account

Finance Bank will have to recredit Daisy's account

Gillian writes a check to Harris as payment for a video game player but soon discovers the player is broken. She goes to the drawee bank and orally authorizes Ilene, a bank officer, to stop payment on the check. This order is valid for..... a. one year b. six months c. fourteen days d. six days

Fourteen days

Ervin signs a check "pay to the order of Felicia" drawn on Ervin's account in Garden Fields Bank. Ervin later orders the bank not to pay the check, but the bank pays it over Ervin's order. Subsequent checks written on Ervin's account "bounce." Most likely liable for the costs to Ervin is...... a. Felicia b. any party to whom a subsequent check was written c. Ervin d. Garden Fields bank

Garden Fields Bank

Foster forges Greta's signature on a check "payable to the order of Foster" drawn on Greta's account in Hearthside Bank. Most likely, if the bank pays the check​...... a. Hearth side will have to recredit Greta's account b. the loss will be apportioned among all the Hearthside's customers c. Greta will be liable for the amount d. The federal reserve will reimburse all parties for their costs.

Hearthside will have to recredit Greta's account

Homer can write checks on his account at InterCity Bank. Jemma steals the checks, forges Homer's signature, and cashes the checks at InterCity. The bank is excused from any liability if, after receipt of the first forged check, Homer fails to report the forgeries within​ a. six month b. one year c. six days d. fourteen days

One year

On the back of a check payable to Nero, Nero writes "Pay to Odell, without recourse" and signs it. This.... a. does not effect the check's negotiability or any party's liability b. renders the check negotiable c. relieves Nero of liability on the check d. relieves Odell of liability on the check

Relieves Nero of liability on the check

Drew signs a check "pay to the order of Eastern State university" drawn on Drew's account in Fidelity Bank to pay her tution. Drew is...... a. none of these choices b. the drawee c. the drawer d. the payee

The Drawer

Clyde issues a check payable to Discount Mart. Elle, Discount's cashier, forges the store's indorsement and deposits the check in her bank account. Clyde's bank, Main Street Bank, pays the check. Clyde can recover from...... a. the bank, which can recover from Ethel b. Ethel, but not the bank c. the bank, which cannot recover from Ethel d. neither Ethel nor the bank

The bank, which can recover from Ethel

Marta has a checking account with Neighbors Bank. Marta signs a check "payable to Olive" drawn on Marta's account. Neighbors Bank is..... a. the drawer b. none of these cchoices c. the drawee d. the payee

The drawee, THE BANK IS ALWAYS THE DRAWEE

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, 2042. To be negotiable, this instrument must include the signature of.... a. Verify chief finanical officer b. Tuna's or Tuna's realtor c. Uri d. a non-party witness

Uri

Barry draws a check payable to "Cash" and presents it to Dollars & Sense store for payment. This instrument is.... a. a bearer instrument b. an order instrument c. valid but negotiable d. void

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. a qualified indorsement b. a special indorsement c. a blank indorsement d. a restrictive indorsement

a blank indorsement

Elmore pays First National Bank $1,000 plus a service fee to draw a check on itself made payable to Go Delivery Service. This is​........ a. a stale check b. an overdraft c. a cashier's check d. a stop-payment order

a cashier's check

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. a nonnegotiable instrument b. a trade acceptance c. a check d. a certificate of deposit

a certificate for deposit

Keanu presents an instrument that states "pay to the order of Laura" to Mega Bank for payment. This instrument is the most common type of negotiable instrument, which is​..... a. a payment via mobile device b. a note c. a check d. a certificate of deposit

a check

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. a payment b. an assignment c. a sale d. a negotiation

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. a restrictive indorsement b. a special indorsement c. a blank indorsement d. a qualified indorsement

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.... a. an order to pay b. a promise to pay c. a certificate of deposit d. a promissory note

an order to pay

Travis signs a check "pay to the order of Umberto" drawn on Travis's account in Valley Bank. Travis has $400 in his account but the amount of the check is $500, which the bank pays. This is.... a. a dishonored check b. a stale check c. an overdraft d. an oversight

an overdraft

Cleo writes a check for $100 drawn on Debit & Credit Bank and presents it to Elegant Jewelers for payment. If the check is not backed by sufficient funds, Cleo may be prosecuted for....... a. forgery b. fraud c. nothing d. negligence

fraud

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...... a. none of the choice b. Fiona c. Home & Farm d. Gerri

home & Farm

Gary writes a check drawn on Hilltop Bank for $400 "payable to Ivan" on May 1. Gary dies on May 3. Ivan presents the check to the bank on May 5. Unaware of Gary's death, the bank​...... a. may pay the check b. can do nothing until Ivan claims an interest in the account c. must consult with Gary's heirs before paying the check d. must certify the check

may pay the check

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..... a. not negotiable, because the reasons for the note are not clear on its face b. Negotiable c. not negotiable, because the payment must come from a particular store d. not negotiable because it states an express condition to payment

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​.... a. negotiable b. not negotiable because the maturity date cannot be determined from the face of the instrument c. not negotiable because there is no option to pay early. d. not negotiable because one month is not a reasonable time

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.... a. refuses to pay it b. charges a fee to cash it c. as talia for a reasonable identification d. asks Talia to sign a receipt for the payment on the check

refuses to pay it

LNG Corporation and Mid States utility Company enter a contract for a sale of liquidized natural gas. LNG draws a draft unconditionally ordering Midstates Utility to $50,000 to LNG's order in sixty days. Midstate Utlity signs and dates the draft. On this instrument, LNG is a. the trader b. the banker c. the maker d. the drawer

the drawe

Erin draws a check payable to "Foodland" to buy groceries. Refer to Fact Pattern 14-1. With respect to Erin's check, FoodLand is... a. the drawee b. the maker c. the payee d. the drawer

the payee

Franco buys a sound system from Georg at Georg's garage sale. Franco writes Georg a check for $250 to pay for the system. Georg is.... a. none of these choice b. The drawer c. the payee d. the drawee

the payee