Question 1

On June 1,Dave Drawer writes a check to Pete Payee.The check is postdated to July 1.Nonetheless,Pete presents the check for payment at Dave's bank on June 15,and receives payment on that date.After Dave learns of this,he screams bloody murder,arguing that the check was not properly payable and that the bank should recredit his account.Is Dave right? Assume that the check is otherwise properly payable,and that Dave never told the bank about it before Pete presented it.

Accepted Answer

The answer of On June 1,Dave Drawer writes a check...

Question 2

Mike buys a new $25,000 turbocharged Dodge Vampire for cash.The dealer requires a certified check for that amount,so Mike gets his bank to certify his check for $25,000.One day later,the bank goes bankrupt.Rather than trying to recover in bankruptcy,the dealer pursues Mike.One of the dealer's theories is that Mike is secondarily liable on the check,and that the bank's default makes Mike liable on the instrument.Is the bank right?

Accepted Answer

The answer of Mike buys a new $25,000 turbocharged Dodge...

Question 3

Adams wrote a check to Jimmy for $5,000.After three days,he met with an accident and died.Now Jimmy wants to collect money from the bank and so he deposited the check.However,the bank is refusing to pay.Is he entitled to get his money?

Accepted Answer

The answer of Adams wrote a check to Jimmy for...

Question 4

_____ is a process which begins with the buyer giving the seller a check,and the seller using the information on that check to name itself as the payee and forwarding it for collection through an automated clearing house.

Accepted Answer

The process described in the question is known as check conversion, where a check is converted into an electronic payment transaction. This involves the seller using the information from the check to name itself as the payee and sending it for collection through an automated clearing house. Options A, C, and D are not relevant to the process described in the question.

Question 5

Under the Electronic Funds Transfer Act how many days do operators of EFT systems have to investigate errors or provisionally recredit a consumer's account?

Accepted Answer

Under the EFT Act,operators of EFT systems have a maximum of 10 working days to investigate errors or provisionally recredit the consumer's account.

Question 6

Due to Susan Sharp's many fraudulent misstatements,Nelly Nice buys Susan's car.Nelly writes Susan a check for $5,000 in payment.Susan immediately negotiates the check to Patty Proper,who qualifies as a holder in due course.In the meantime,Nelly discovers that the car is junk and makes a timely and proper stop-payment order to her bank.However,when Patty presents the check for payment,the bank pays it anyway.Is the bank required to recredit Nelly's account?

Accepted Answer

The answer of Due to Susan Sharp's many fraudulent misstatements,Nelly...

Question 7

Which of the following is true of the Check 21 Act?

Accepted Answer

Check 21 authorizes banks to transform information they receive in electronic form back into a paper copy of the check.

Question 8

Banks can retain the legible copy of check for a period of:

Accepted Answer

Existing state law requires that banks retain a legible copy of checks for seven years,but does not require that the copies returned to customers with statements be legible.

Question 9

Laura gets a statement and a pile of paid checks from her bank on June 1.Within the pile of checks,is one check with a forged drawer's signature.Laura does not notify the bank about the forged check until the next month,July 1.Does this delay remove the bank's obligation to recredit Laura's account?

Accepted Answer

The answer of Laura gets a statement and a pile...

Quiz 34: Checks and Electronic Transfers

Adams wrote a check to Jimmy for $5,000.After three days,he met with an accident and died.Now Jimmy wants to collect money from the bank and so he deposited the check.However,the bank is refusing to pay.Is he entitled to get his money?

_____ is a process which begins with the buyer giving the seller a check,and the seller using the information on that check to name itself as the payee and forwarding it for collection through an automated clearing house.

Under the Electronic Funds Transfer Act how many days do operators of EFT systems have to investigate errors or provisionally recredit a consumer's account?

Which of the following is true of the Check 21 Act?

Banks can retain the legible copy of check for a period of: