Question 1

Banking and the collection process of checks is governed solely by state law, primarily the UCC.

Accepted Answer

A) True 
 B)False

Question 2

Banks like electronic funds transfers because they eliminate the float time that a drawer enjoys on a checking account and the paperwork involved in processing checks.

Accepted Answer

A) True 
 B)False

Question 3

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.

Accepted Answer

A) True 
 B)False

Question 4

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

Accepted Answer

A)  depositary bank. 
B)  drawee bank. 
C)  payor bank. 
D)  intermediary bank. 
A)  depositary bank. 
B)  drawee bank. 
C)  payor bank. 
D)  intermediary bank.

Question 5

A payment order:

Accepted Answer

A)  is a sender's instruction to a receiving bank to pay, or to cause another bank to pay, a fixed or determinable amount of money to a beneficiary. 
B)  is issued when sent and, if more than one payment is to be made, the payments are condensed into one payment order. 
C)  must be communicated in writing or electronically. 
D)  All of these. 
A)  is a sender's instruction to a receiving bank to pay, or to cause another bank to pay, a fixed or determinable amount of money to a beneficiary. 
B)  is issued when sent and, if more than one payment is to be made, the payments are condensed into one payment order. 
C)  must be communicated in writing or electronically. 
D)  All of these.

Question 6

Wholesale electronic funds transfers:

Accepted Answer

A)  are also called wholesale wire transfers. 
B)  involve the transfer of more than one trillion dollars each business day. 
C)  use Fedwire, CHIPS, and numerous private wire systems. 
D)  All of these. 
A)  are also called wholesale wire transfers. 
B)  involve the transfer of more than one trillion dollars each business day. 
C)  use Fedwire, CHIPS, and numerous private wire systems. 
D)  All of these.

Question 7

If First Bank receives a check for collection on Friday at 4 p.m., it must present the check to the payor bank by midnight Saturday.

Accepted Answer

A) True 
 B)False

Question 8

What is the effect of a payor bank's dishonor of a check?

Accepted Answer

A)  It returns the check to each intermediary or collecting bank. 
B)  The provisional credits must be reversed. 
C)  The customer who deposited the item for collection must cover the item and seek recovery from the drawer or indorsers. 
D)  All of these will occur. 
A)  It returns the check to each intermediary or collecting bank. 
B)  The provisional credits must be reversed. 
C)  The customer who deposited the item for collection must cover the item and seek recovery from the drawer or indorsers. 
D)  All of these will occur.

Question 9

What Article of the UCC governs electronic funds transfers?

Accepted Answer

A)  Article 3 
B)  Article 4 
C)  Article 4A 
D)  Article 5 
A)  Article 3 
B)  Article 4 
C)  Article 4A 
D)  Article 5

Question 10

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.

Accepted Answer

A) True 
 B)False

Question 11

What is electronic funds transfer? Why do banks like it? What provisions are in the law to protect the customer who uses electronic funds transfer?

Accepted Answer

EFTs are any transfers of funds, other t

Exam 29: Bank Deposits, Collections, and Funds Transfers

Banking and the collection process of checks is governed solely by state law, primarily the UCC.

Banks like electronic funds transfers because they eliminate the float time that a drawer enjoys on a checking account and the paperwork involved in processing checks.

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.

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

A payment order:

Wholesale electronic funds transfers:

If First Bank receives a check for collection on Friday at 4 p.m., it must present the check to the payor bank by midnight Saturday.

What is the effect of a payor bank's dishonor of a check?

What Article of the UCC governs electronic funds transfers?

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.

What is electronic funds transfer? Why do banks like it? What provisions are in the law to protect the customer who uses electronic funds transfer?

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