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When a Drawee Bank Is Presented with a Check Drawn

Question 94

Multiple Choice

When a drawee bank is presented with a check drawn on a customer's account in which there are not sufficient funds to pay the check,the bank:


A) must pay the check if the customer is an established customer.
B) is not permitted to pay the check.
C) must notify the drawer before deciding whether or not to pay the check.
D) may choose whether to pay the check, but cannot charge interest on the overdraft unless the customer previously agreed to the payment of overdraft interest.
E) may choose whether to pay the check, and can charge interest on the overdraft in all circumstances.

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