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1. Under the Uniform Commercial Code, a "note" is best defined as:

An obligation that is conditioned upon the occurrence of a future event.

A document that itemizes an individual or corporation's assets.

A two-party instrument which the maker promises to pay a bearer.

An instrument which lists all outstanding obligations owed to a lender.

2.) If a substantial amount of time has elapsed from the date the check was made out to the date it is presented to the bank for payment, the check is said to be

A.) Lapsed

B.) Stale

C.) Overdue

D.) Post-dated

3.) When a customer deposits a check into his or her account, the first __________must be made available to the customer the next day.

A.) 25

B.) 50

C.) 100

D.) 200

4.) If a customer can establish that a bank was negligent in paying a forged or altered check:

A.) The bank will always be liable to the customer for the amount of the forged or altered check.

B.) The customer has no legal remedies unless he or she detected the forgery beforehand.

C.) The customer's account will be debited in the amount of the forged or altered check.

D.) The bank cannot avail itself of a defense based on the customer's tardiness in reporting the alteration or forgery.

5.) The usual words of negotiability are __________ and __________.

A.) Debtor and Creditor.

B.) Order and Bearer.

C.) Principal and Agent.

D.) Buyer and Seller.

6.) For an instrument to be negotiable, the maker must pledge:

A.) A particular type of fund.

B.) His or her general credit.

C.) interest Payments

D.) Attorneys fees in the event of collection proceedings.

7.) If the name of the payee on an instrument is misspelled, the payee may negotiate the instrument by indorsing any of the following, except:

A.) The payee's true name.

B.) The payor's true name.

C.) The misspelled name on the instrument.

D.) Both the payee's true name and the misspelled name on the instrument.

8.) Employer made Valuable Employee a loan of $12,000 so that Valuable could pay his tuition at Local University. The note called for the loan to be repaid within 12 months. The note also contained a provision that allowed Valuable to take an additional 6 months to pay the $12,000 "if Valuable needs extra time." This clause in the note is a (n) ___________clause.

A.) Allonge

B.) Extension

C.) Acceleration

D.) Punitive

9.) A check payable to the order of a person would require his or her _________ if it is to be negotiated.

Appearance in person.

Endorsement.

Waiver.

Collateral or security interests.

20.) Which of the following qualifies as a negotiable instrument under the particular fund doctrine?

A check which indicates that it will be paid out of account #234567 at First Bank.

A note which states: "I promise to pay Alice $500 only out of the profits from my yard sale.

"A note which states: "I promise to pay to the order of Alice $500 only out of the profits from my yard sale."

All of the above are negotiable instruments under the particular fund doctrine.