Exam 29: Bank Deposits,collections,and Funds Transfers

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Montey receives his monthly bank statement on December 30th.He looks at it quickly,then sets it aside.Three days later,he examines it again and discovers a forged check.What must he do to avoid responsibility for the check? Cite Code provisions.

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Question 1

Correct Answer:

Verified

He must notify the bank promptly,in a reasonable time not to exceed 30 days (UCC Sec.4-406(d)).Failure to report within one year of receipt of the statement will bar him from asserting the forgery against the bank (UCC Sec.4-406(f)).

Mark takes his wife's paycheck to Valley Bank to deposit in their joint account.Valley Bank may deposit the check without his wife's indorsement unless the indorsement is expressly required.

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(True/False)

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Question 2

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True

Describe and summarize what happens during the collection process once a check is deposited in a customer's account.How does it get back to the drawee?

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Question 3

Correct Answer:

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When a person deposits a check in his bank (the depositary bank),the bank credits his account by the amount of the check with a provisional credit.If the depositary bank is not the payor (drawee)bank,the check passes either directly through a clearinghouse or through one or more intermediary banks until it reaches the payor/drawee bank for collection.When the check is paid,all provisional settlements become final and the transaction is completed.

The relationship between the payor bank and its checking account customer is exclusively governed by statute and leaves no room for contractual modifications.

(True/False)

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Question 4

All depositary institutions are required to disclose APY earned and balance information,including how the balance is calculated,on the periodic statements they must send to customers.

(True/False)

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Question 5

If a depositor in Mountain Bank takes a check written on Valley Bank to Mountain Bank to deposit,it will normally be credited to the depositor's account at the time of the transaction.This is called a "provisional" credit.

(True/False)

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Question 6

The Check Clearing for the 21st Century Act requires banks to accept checks in electronic form.

(True/False)

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Question 7

Consumer electronic funds transfers are covered by Article 4A of the UCC,and nonconsumer electronic transfers are covered by the federal Electronic Fund Transfer Act.

(True/False)

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Question 8

Wholesale electronic funds transfers:

(Multiple Choice)

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Question 9

If a bank pays on a check after the death of its customer,the customer's estate is not automatically entitled to reimbursement.

(True/False)

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Question 10

A check drawn on a bank is an order to pay a sum of money and an authorization to charge the amount to the drawer's account.The drawer may countermand this order by which of the following?

(Multiple Choice)

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Question 11

A preauthorized fund transfer may be made from a consumer's account if the authorization is done in advance and in writing.

(True/False)

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Question 12

Darla drew a $100 check on Union Trust Bank payable "to the order of Pamela." Pamela cashed the check at Mountain Bank.Mountain Bank is an agent of Pamela until the drawee bank pays the check.

(True/False)

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Question 13

On April 6,Ellen sends a check for a magazine subscription and then discovers she has already paid for it.She calls her bank and orders that the bank not make payment.That order will be good until:

(Multiple Choice)

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Question 14

Sylvia deposits a $50 check drawn on Valley Bank into her account at First Bank.First Bank transfers the check to Second Bank,which in turn forwards it to Valley Bank,which pays the item.Which of the following is correct?

(Multiple Choice)

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Question 15

If you lose your wallet along with your bank ATM card,your liability is

(Multiple Choice)

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Question 16

If Margie makes out a check for $27.50 when she has only $10 in her account,her bank may:

(Multiple Choice)

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Question 17

If a bank receives a check on Tuesday,it must take proper action by midnight of Wednesday.

(True/False)

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Question 18

The desired effect of EFTS is to:

(Multiple Choice)

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Question 19

The first bank to receive a check for collection is the:

(Multiple Choice)

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Question 20

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Exam 29: Bank Deposits,collections,and Funds Transfers

Montey receives his monthly bank statement on December 30th.He looks at it quickly,then sets it aside.Three days later,he examines it again and discovers a forged check.What must he do to avoid responsibility for the check? Cite Code provisions.

Mark takes his wife's paycheck to Valley Bank to deposit in their joint account.Valley Bank may deposit the check without his wife's indorsement unless the indorsement is expressly required.

Describe and summarize what happens during the collection process once a check is deposited in a customer's account.How does it get back to the drawee?

The relationship between the payor bank and its checking account customer is exclusively governed by statute and leaves no room for contractual modifications.

All depositary institutions are required to disclose APY earned and balance information,including how the balance is calculated,on the periodic statements they must send to customers.

If a depositor in Mountain Bank takes a check written on Valley Bank to Mountain Bank to deposit,it will normally be credited to the depositor's account at the time of the transaction.This is called a "provisional" credit.

The Check Clearing for the 21st Century Act requires banks to accept checks in electronic form.

Consumer electronic funds transfers are covered by Article 4A of the UCC,and nonconsumer electronic transfers are covered by the federal Electronic Fund Transfer Act.

Wholesale electronic funds transfers:

If a bank pays on a check after the death of its customer,the customer's estate is not automatically entitled to reimbursement.

A check drawn on a bank is an order to pay a sum of money and an authorization to charge the amount to the drawer's account.The drawer may countermand this order by which of the following?

A preauthorized fund transfer may be made from a consumer's account if the authorization is done in advance and in writing.

Darla drew a $100 check on Union Trust Bank payable "to the order of Pamela." Pamela cashed the check at Mountain Bank.Mountain Bank is an agent of Pamela until the drawee bank pays the check.

On April 6,Ellen sends a check for a magazine subscription and then discovers she has already paid for it.She calls her bank and orders that the bank not make payment.That order will be good until:

Sylvia deposits a $50 check drawn on Valley Bank into her account at First Bank.First Bank transfers the check to Second Bank,which in turn forwards it to Valley Bank,which pays the item.Which of the following is correct?

If you lose your wallet along with your bank ATM card,your liability is

If Margie makes out a check for $27.50 when she has only $10 in her account,her bank may:

If a bank receives a check on Tuesday,it must take proper action by midnight of Wednesday.

The desired effect of EFTS is to:

The first bank to receive a check for collection is the:

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