Question 1

If a lost negotiable instrument is in bearer form at the time of the loss, the finder is entitled to enforce payment.

Accepted Answer

A) True 
 B)False

Question 2

A restrictive endorsement specifies the purpose of the endorsement or the use to be made of the paper.

Accepted Answer

A) True 
 B)False

Question 3

If a lost instrument is order paper, the finder __________.

Accepted Answer

A)  becomes the assignee of the instrument.
B)  becomes the owner of the instrument.
C)  becomes the holder of the instrument.
D)  does not become the holder of the instrument.E) All of the above
F) None of the above

Question 4

A forged or unauthorized endorsement is by definition:

Accepted Answer

A)  an endorsement of the person by whom it appears to have been made.
B)  no endorsement of the person by whom it appears to have been made.
C)  binding on the party who refuses to ratify the instrument.
D)  incapable of being ratified.E) B) and D)
F) None of the above

Question 5

A payee or endorsee whose name is misspelled may endorse the wrong name, the correct name, or both.

Accepted Answer

A) True 
 B)False

Question 6

A blank endorsement indicates the person to whom the instrument is to be paid-that is, the transferee.

Accepted Answer

A) True 
 B)False

Question 7

To enforce an implied warranty of an indorser, the party claiming under the warranty must give the indorser notice of the breach within fourteen (14) days after the claimant learns or has reason to know of the breach and the identity of the indorser.

Accepted Answer

A) True 
 B)False

Question 8

A restrictive indorsement reduces the risk of theft or unauthorized transfer by eliminating the bearer quality of a blank indorsement.

Accepted Answer

A) True 
 B)False

Question 9

When a special endorsement is made, the instrument becomes order paper and may be negotiated only by an endorsement and delivery.

Accepted Answer

A) True 
 B)False

Question 10

Endorsements may be classified in terms of whether the indorser has added any words to the endorsement and what those words are.

Accepted Answer

A) True 
 B)False

Question 11

Sue is an employee at an ABC store. One of Sue's duties is to prepare the bank deposit at the end of the business day. Sue had a very busy day and made a few mistakes. All of the checks, except two, were endorsed with the stamp "ABC, Inc." that ABC had provided. The bank received the deposit and noticed the lack of endorsement on the two checks. In addition, three of the checks that Sue was to include with the deposit were lost in the parking lot after closing. Phil found the checks and deposited them into his personal account. What is the effect of ABC's endorsement on the lost checks and the lack of endorsement on the two deposited checks?

Accepted Answer

A bank may provide an endorsement for it...

Question 12

When the indorser merely signs a negotiable instrument, the indorsement is called a __________ indorsement.

Accepted Answer

A)  special
B)  qualified
C)  blank
D)  restrictiveE) A) and B)
F) All of the above

Exam 29: Transfers of Negotiable Instruments and Warranties of Parties

A restrictive indorsement reduces the risk of theft or unauthorized transfer by eliminating the bearer quality of a blank indorsement.

Correct Answer
verified

If a lost negotiable instrument is in bearer form at the time of the loss, the finder is entitled to enforce payment.

Correct Answer
verified

A blank endorsement indicates the person to whom the instrument is to be paid-that is, the transferee.

Correct Answer
verified

To enforce an implied warranty of an indorser, the party claiming under the warranty must give the indorser notice of the breach within fourteen (14) days after the claimant learns or has reason to know of the breach and the identity of the indorser.

Correct Answer
verified

A payee or endorsee whose name is misspelled may endorse the wrong name, the correct name, or both.

Correct Answer
verified

A restrictive endorsement specifies the purpose of the endorsement or the use to be made of the paper.

Correct Answer
verified

A forged or unauthorized endorsement is by definition:

Correct Answer
verified

When the indorser merely signs a negotiable instrument, the indorsement is called a __________ indorsement.

Correct Answer
verified

If a lost instrument is order paper, the finder __________.

Correct Answer
verified

Endorsements may be classified in terms of whether the indorser has added any words to the endorsement and what those words are.

Correct Answer
verified

When a special endorsement is made, the instrument becomes order paper and may be negotiated only by an endorsement and delivery.

Correct Answer
verified

Correct Answer
verified
A bank may provide an endorsement for it...
View Answer

Exam 29: Transfers of Negotiable Instruments and Warranties of Parties

A restrictive indorsement reduces the risk of theft or unauthorized transfer by eliminating the bearer quality of a blank indorsement.

Correct AnswerverifiedShow Answer

If a lost negotiable instrument is in bearer form at the time of the loss, the finder is entitled to enforce payment.

Correct AnswerverifiedShow Answer

A blank endorsement indicates the person to whom the instrument is to be paid-that is, the transferee.

Correct AnswerverifiedShow Answer

To enforce an implied warranty of an indorser, the party claiming under the warranty must give the indorser notice of the breach within fourteen (14) days after the claimant learns or has reason to know of the breach and the identity of the indorser.

Correct AnswerverifiedShow Answer

A payee or endorsee whose name is misspelled may endorse the wrong name, the correct name, or both.

Correct AnswerverifiedShow Answer

A restrictive endorsement specifies the purpose of the endorsement or the use to be made of the paper.

Correct AnswerverifiedShow Answer

A forged or unauthorized endorsement is by definition:

Correct AnswerverifiedShow Answer

When the indorser merely signs a negotiable instrument, the indorsement is called a __________ indorsement.

Correct AnswerverifiedShow Answer

If a lost instrument is order paper, the finder __________.

Correct AnswerverifiedShow Answer

Endorsements may be classified in terms of whether the indorser has added any words to the endorsement and what those words are.

Correct AnswerverifiedShow Answer

When a special endorsement is made, the instrument becomes order paper and may be negotiated only by an endorsement and delivery.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedA bank may provide an endorsement for it...View AnswerShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A bank may provide an endorsement for it...
View Answer