Question 1

If Nina deposits a check from Rico's bank into her bank that was made payable to her by Rico,any settlement given by Nina's bank is provisional.

Accepted Answer

A) True 
 B)False  True

Question 2

Janice and her daughter have a joint checking account.The basic insurance coverage by the FDIC can protect this account only up to $250,000.

Accepted Answer

A) True 
 B)False  False

Question 3

Regulation CC requires banks to make all deposited funds available to depositors within twenty-four (24)hours,or the next business day.

Accepted Answer

A) True 
 B)False  False

Question 4

A depositary bank is the first bank to which an item is transferred in the course of collection.

Accepted Answer

A) True 
 B)False

Question 5

A stale check is a check that is presented for payment more than 60 days after its date.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is true of a bad-check statute?

Accepted Answer

A) The payee does not have the obligation of informing the drawer of the nonpayment of the check. 
B) Bad-check statutes are effectively used as a means of collection. 
C) The payee can prosecute the drawer immediately after being notified of a bad check by the drawee bank. 
D) The drawee bank can prosecute the payee in case of dishonor of a check. 
A) The payee does not have the obligation of informing the drawer of the nonpayment of the check. 
B) Bad-check statutes are effectively used as a means of collection. 
C) The payee can prosecute the drawer immediately after being notified of a bad check by the drawee bank. 
D) The drawee bank can prosecute the payee in case of dishonor of a check.

Question 7

Under the Check 21 Act,bank customers have an absolute right to see their original checks.

Accepted Answer

A) True 
 B)False

Question 8

An oral stop payment ordered by a drawer is valid:

Accepted Answer

A) for 14 calendar days only. 
B) if it is received in time and in such a manner as to afford the bank a reasonable opportunity to act on it. 
C) for only one year,unless renewed in writing. 
D) only on limited items payable on his or her account,and cannot be used for checks with a value of $500 and above. 
A) for 14 calendar days only. 
B) if it is received in time and in such a manner as to afford the bank a reasonable opportunity to act on it. 
C) for only one year,unless renewed in writing. 
D) only on limited items payable on his or her account,and cannot be used for checks with a value of $500 and above.

Question 9

Dreamwork Bank uses the substitute check procedure to rapidly obtain payment of items deposited by its customers.An employee of the bank fraudulently alters some substitute checks so that they are for greater amounts than the original paper check and embezzles the difference.Discuss the bank's warranties in this situation.

Accepted Answer

Banks using substitute checks for consid

Question 10

If a bank pays a check in cash to the payee,and the check is returned to the drawer with the next bank statement,the bank's settlement is said to be:

Accepted Answer

A) provisional. 
B) final. 
C) in due course. 
D) honored. 
A) provisional. 
B) final. 
C) in due course. 
D) honored.

Question 11

On July 15th,the day he died,Sam wrote a check to Century Link to pay for his phone and Internet.On July 20th,an announcement of Sam's death was published in the local paper.But the check,along with others,sat on Sam's desk until August 15th,when the executor mailed them.Sam's bank must pay this check.

Accepted Answer

A) True 
 B)False

Question 12

The first bank to which an item is transferred for collection is called a(n)________ bank.

Accepted Answer

A) local 
B) remitting 
C) depositary 
D) intermediary 
A) local 
B) remitting 
C) depositary 
D) intermediary

Question 13

Small Bank mistakenly dishonors a $5,000 check written by its customer,Wanda,to Hyram Real Estate as a down payment for a new home.As a result of the dishonor,Wanda's closing is delayed by thirty days.She incurs $500 extra rental expenses,$1,000 in attorney's fees and home mortgage interest rates increase by one half percent before her closing.Hyram deposited the $5,000 check in its account and suffered $300 in NSF charges when credit for the deposit was withdrawn.Discuss the liability of Small Bank to Wanda and Hyram.

Accepted Answer

Small Bank is liable to Wanda for her ac

Question 14

A consumer has the right to claim an expedited credit if the customer asserts in good faith that the:

Accepted Answer

A) bank charged the consumer's account for a substitute check that was not given to the consumer. 
B) check was not properly charged to the consumer's account. 
C) consumer did not suffer a resulting loss. 
D) production of another substitute check is necessary to determine the validity of any claim. 
A) bank charged the consumer's account for a substitute check that was not given to the consumer. 
B) check was not properly charged to the consumer's account. 
C) consumer did not suffer a resulting loss. 
D) production of another substitute check is necessary to determine the validity of any claim.

Question 15

While cleaning out her desk,Chen found a certified check she had received eight months earlier and had forgotten to cash.When she brought the check to the bank on which it was drawn,the bank refused to cash it.Discuss the legal rights of the parties in this case.

Accepted Answer

A bank is under no obligation

Question 16

Josie writes a check on January 15 to Rusty Enterprises,but later realizes that the merchandise she purchased was of poor quality.She gives a stop payment order to the bank on January 20.Her bank has the check in its possession and is accepting it as she completes her stop payment order.Her bank pays the check,and Josie demands that her account be recredited.Discuss the legal aspects of this situation.

Accepted Answer

A stop payment order must be received in

Question 17

The Identity Theft Penalty Enhancement Act added a new crime called ________ to the original statute.

Accepted Answer

A) aggravated identity theft 
B) fraudulent misrepresentation 
C) uttering 
D) identity violation 
A) aggravated identity theft 
B) fraudulent misrepresentation 
C) uttering 
D) identity violation

Question 18

Oliver wrote a check to Greg Motors for $4,000 drawn on Uphill Bank in payment for a secondhand car.Greg Motors deposited the check in its account at Seventh Day Bank,which sends the check to Uphill Bank for collection.Oliver's car broke down before he reached home that evening,and he contacted his bank to stop payment on the check.Discuss what Uphill bank must do with the check to ensure a stop payment.

Accepted Answer

Uphill Bank must return the check to Sev

Question 19

A business receiving money by electronic transfer is known as the beneficiary.

Accepted Answer

A) True 
 B)False

Question 20

Winston was going to be out of town on September 1,when his rent would be due.On August 20 he gave his landlord Becky a check dated September 1,with instructions not to deposit or cash the check until September 1.As the instructions to Becky were clear,he did not notify the bank of the postdated check.On August 21,Becky deposited the check in her account at her bank and the check was dishonored on August 23.Which of the following is true of this scenario?

Accepted Answer

A) Winston has recourse against Becky as she did not follow his instructions. 
B) Winston has recourse against Becky and the bank since it failed to refuse the item when deposited. 
C) Winston has recourse against the bank as it failed to notify Winston of the check acceptance and failed to refuse the item when deposited. 
D) Winston did not notify the bank not to pay it before the date on the check,hence he has no recourse. 
A) Winston has recourse against Becky as she did not follow his instructions. 
B) Winston has recourse against Becky and the bank since it failed to refuse the item when deposited. 
C) Winston has recourse against the bank as it failed to notify Winston of the check acceptance and failed to refuse the item when deposited. 
D) Winston did not notify the bank not to pay it before the date on the check,hence he has no recourse.

Exam 18: Bank-Depositor Relationships and Cyber-Banking

If Nina deposits a check from Rico's bank into her bank that was made payable to her by Rico,any settlement given by Nina's bank is provisional.

Janice and her daughter have a joint checking account.The basic insurance coverage by the FDIC can protect this account only up to $250,000.

Regulation CC requires banks to make all deposited funds available to depositors within twenty-four (24)hours,or the next business day.

A depositary bank is the first bank to which an item is transferred in the course of collection.

A stale check is a check that is presented for payment more than 60 days after its date.

Which of the following is true of a bad-check statute?

Under the Check 21 Act,bank customers have an absolute right to see their original checks.

An oral stop payment ordered by a drawer is valid:

If a bank pays a check in cash to the payee,and the check is returned to the drawer with the next bank statement,the bank's settlement is said to be:

The first bank to which an item is transferred for collection is called a(n)________ bank.

A consumer has the right to claim an expedited credit if the customer asserts in good faith that the:

While cleaning out her desk,Chen found a certified check she had received eight months earlier and had forgotten to cash.When she brought the check to the bank on which it was drawn,the bank refused to cash it.Discuss the legal rights of the parties in this case.

The Identity Theft Penalty Enhancement Act added a new crime called ________ to the original statute.

A business receiving money by electronic transfer is known as the beneficiary.

Ethics,social Responsibility,and the Law

Sources of the Law

The Judicial Process and Cyber-Procedure

Alternative Dispute Resolution and Cyber-Adr

Criminal Law and Cybercrimes

Tort Law and Cybertorts

The Essentials of Contract Law

Offer,acceptance,and Mutual Assent

Consideration and Cyber-Payments

Capacity and Legality: the Final Elements

Written Contracts and Cyber-Commerce

Third Parties,discharge,and Remedies

Sales Contracts: Formation,title,and Risk of Loss

Sales Contracts: Rights,duties,breach,and Warranties

Product Liability and Consumer Protection

The Nature of Negotiable Instruments

Holders in Due Course,defenses,and Liabilities

Insurance

Mortgages, land Contracts, and the 21st-Century Financial Crisis

Bankruptcy Law: in Theory, in History, and in Practice

Agency Law

Employment Law

Labor Law

The Business Entity: an Introduction

The Corporate Entity

Managing the Corporate Entity

Government Regulation of the Corporate Entity

Personal Property and Bailments

Real Property and Landlord and Tenant Law

Wills, advanced Directives, and Trusts

Professional Liability

Science, technology, and Law in the 21st Century

International Law and the New World Order

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