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Exam 22: Banking System and Electronic Financial Transactions

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Question 41

Multiple Choice

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________ of the Uniform Commercial Code establishes the requirements for negotiable instruments.

A) Article 3
B) Article 4
C) Article 4A
D) Article 5

E) B) and D)
F) None of the above

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Question 42

True/False

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The drawer's failure to report a forged or altered check to the bank within one year of receiving the bank statement and canceled checks containing it relieves the bank of any liability for paying the instrument.

A) True
B) False

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Question 43

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In a relationship that is created when a customer deposits money into the bank,the customer is the debtor.

Jill Scott is an accountant with Cameron and Associates,a law firm in Seattle.The firm maintains a checking account with Southern Rock Bank for its operating expenses.On the 10th of every month,Jill gets an inventory report from the office manager listing the office supplies that are needed.Jill places the appropriate orders with Office Depot and writes them a check against the office's checking account.In the above banking transaction,Cameron and Associates is the ________.

If there are major failures of several large banks or many small banks,and the FDIC insurance fund is insufficient to cover all of the depositors' losses,which of the following bodies is responsible for paying the depositors money owed by the FDIC?

What responsibility do banks and checking account customers have with respect to examining bank statements?

Which of the following is an accurate description of wrongful dishonor of a check?

The Pittsburgh Peelers are a professional soccer team playing in the national league.They recently approached Darth Water,a leading sports-drink manufacturer,to sponsor their team for the upcoming season.Darth Water agrees to sponsor the team for an amount of $1 million,to be paid in installments over the course of the season.Darth Water instructs its bank,Orange County Bank,to wire the funds to Pittsburgh Peelers' bank,the Jersey Shore Bank,with instructions to credit Pittsburgh Peelers' account.Which of the following parties is the originator of the wire transfer in the above case?

Credit extension is a common occurrence with regard to debit cards.

In which of the following cases is an overdraft created in a drawer's account?

The bank where the payee or holder of a check has an account is known as the ________.

Explain,in brief,the Uniform Commercial Code and a few of its articles related to financial transfers and the banking system.

Ram receives a check for $100 from Sharon.He signs the back of the check and turns it over to Luke to pay off the $100 he owed Luke.The check is now said to be ________.

A written stop-payment order is valid for ________.

The Dodd-Frank Wall Street Reform and Consumer Protection Act regulates lending procedures.

The bank on which a check is drawn is called the ________.

An oral stop-payment order is binding on the bank for ________.

When a bank pays the holder of a properly drawn check,it is said to have ________ the check.

A person can purchase a(n) ________ from a bank by paying the bank the amount of the check plus a fee for issuing the check.

Article 3 of the Uniform Commercial Code establishes the ________.