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Ch. 30 negotiation
Negotiations and proper endorsements
| Question | Answer |
|---|---|
| What is an instrument that was dated later than the date of issuance? Ex: this person may not have funds in their bank account at the time the check was written. | Postdated (the commercial paper is still negotiable) |
| __________means that the commercial paper is written payable on or before an identified calendar date. | Payable at a definite time (promissory note with a specific pay date) |
| When commercial paper is made payable to the order of a specified payee, it is called______ | Order Paper (Pay to the order of Charles Jordan) |
| When commercial paper is legally collectible by the party in possession of it, it is referred to as _______ | Bearer paper |
| True/False order paper may be made payable to the order of more than one party. | True. Ex: "Pay to the order of Daniel and Emillia Elliot" Either can sign and cash the check |
| ____________means that it must be in writing, be signed by maker or drawer, and contain an uncontional promise or order payable in a certain sum of money, be payable on demand or at a definte time, and be payable to someone's order or bearer paper | negotiable |
| What are the two ways that we've discussed in which commercial paper can be transferred? | Negotiation and assignment |
| A signature on the back of an instrument is known as an __________ | Endorsement |
| Christy has physical possesion of a commercial paper that is payable to the order of her. She is know known as the _________ of this commercial paper | Holder |
| When should a blank endorsment be used in order to ensure safety of the commercial paper? | 1. Value is immediately received for it 2. The paper is deposited in a bank at the time of endorsement |
| A (an) _______ endorsement directs the use of the proceeds from the instrument or imposes a condition upon payment of the instrument by the endorser. | Restrictive |
| Sometimes a person who desires to borrow money or to cash a check is not well known or doesn't have a good credit rating. They would need an accommodating party also known as a ______________ to assist them in these processes. | Co signor |
| A (an) __________ endorsement makes the paper payble to the order of a designated party. | Special |
| Can a pencil be used to sign checks? | Yes, but it is not wise, because the check can be easily altered. |
Created by:
acct1
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