Exam 22: Banking System and Electronic Financial Transactions

The bank where the payee or holder has an account is called the collecting bank.

A certified check must contain the ________.

The bank where the drawer has a checking account and on which a check is drawn is called the ________ bank.

An oral order to stop payment of a check is invalid.

Article 3 of the UCC establishes the rules and principles that regulate bank deposit and collection procedures.

How is a cashier's check different from an ordinary check?

George,John,Paul,Ringo,and Brian are five friends from Iowa.George owes John $100,John owes Paul $200,Paul owes Ringo $300,and Ringo owes Brian $400.John and Paul find a check belonging to George.John names himself as the payee on the check,fills in $200 as the amount,and forges George's signature on it.He indorses the check to Paul and asks him to consider his debt repaid,while keeping the knowledge of the forgery to himself.Paul,in turn,indorses the check to Ringo and pays Ringo the remaining $100 in cash.Ringo indorses the check to Brian,who presents the check to George's bank and receives payment.Who among the following can the bank recover the money from,once the forgery is detected?

A cashier's check is a(n)________ check.

The amount of money a drawer owes a bank after it has paid a check despite the drawer's account having insufficient funds is termed ________.

A forged signature is wholly inoperative as the signature of the drawer.

The Federal Reserve System was created by Congress as the central bank of the United States.

A(n)________ is an order by the drawer to the drawee bank to pay a specified sum of money from the drawer's checking account to the named payee (or holder).

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.Who is the drawee in this banking transaction?

The term ________ refers to the computer and electronic technology that makes it possible for banks to offer electronic payment and collection systems to bank customers.

The Federal Bureau of Investigation (FBI)is authorized to investigate forgeries,bank fraud,and other financial crimes.

The original tenor is the ________.

The drawback of wire transfers is the lack of speed.

Describe the parties to an ordinary check with the help of an example.

A bank in the collection process that is not the depository bank or the payer bank is called an intermediary bank.

Raj receives a check for $100 from Sheldon.He signs the back of the check and turns it over to Leo to pay off the $100 he owed Leo.In this case,Raj is the ________.