PUP College of Accountancy & Finance NEGOTIABLE INSTRUMENT LAW BANKING LAWS AY, 2017-2018 Secood Semester 4° Evaluation Examinations 1. Which of the fotowing knot» restive indersement? 2. “Pay to Petar for depot.” “Pay to Pater aad tome some person” “Pay te Peter this ow rk” €."Pay to Peter for ry we” ‘A 2.Aga generat rule, tn instrument negotiable i origins shuays negatiable antl paid. Whar i re exception? ‘when the instrument Is indorsed in this manner “Pay t0 Getyn on" 1. payment in due course bythe party accommodated, where the instrument is indorsed for his accommedetion: c when the Inserument le dishonored or siready overdue: payment by the iadorser to the holier in due course 3. Whose laity Is conditional? maker; b. payee; € deawee; 4. drawer. A. 4. Unconattonal promise ts eszental to the negotiabltty ofa promissory note and may be expressed In phrasas of equivalent meaning. Which of te following does not signify promise? 2. “lagree to pay" ‘c “we will pay? . “for value received” ‘6.4 undertake to make good.” 5. One that expresses a sum certain: _2 to pay P10,000.00 plus interest; '. to pay P5,000.00 and my share of the profts; «to pay P1,000.00 oF my salary for the next month; 4. t0 pay P15,000.00 plus the fair market value of my specific car; 6. Words that do not indicate negotiabity: ‘a, “due to Mark or order?” 1b.“ acknowledged being indebted in the amount of P2,000,00 to Meavel or demand?” ‘. "IOU Paula P2,000.00 to be paid on December 15, 2018;" 4. none of the above. 7. Words that are equivalent to an order to pay: * 2.I hope you would pays" tplease let the holder” .“Lexpect that you would pay” "We authorize you to pay? ‘8, What phase does not express a sum certain? '3¢“To pay P1,800.00 or what may be due on my commission,” “To pay P2,800.00 with__ interest a month”; "To pay P2,800.00 in two annual equal installments beginning January 12, 2020; 4. Allof the above. 8. person who is not ible on the negotiable instrument: ‘2, One who makes a conditional promise in advance to accept a future bill of exchange; 'b, One who signs using an assumed name; ’A person whose signature is forged; 4. A party negotiating by mere delivery, 110. The maker is Hable from the moment; a¢ He makes the note; He Issues the note; ¢. He negotiates the note; 4d. He delivers the note. 11. A party who can expressly limit his liability to the holder: a. Drawee; bt Drawer; c Maker; 4. None of the above. 3 12. tis not a material alteration: an erasure of the word “agent” appearing under the name of a party; ‘an innocent change inthe date of the instrument; © an addition of the word “surety” after the name af the co-maker; 4.an alteration on the serial number ofa check; ~f3 i AB, What isthe legal effect fa fea inate negotiable instrument ls materially atvered by the holder without the assent of all parties * 4. the instrument is avotded; al prior parties thereto are la '. the Instrument is partially inoperative: the moe eeatn bs whaiy operat, 14.The tle ota pron who negates the sume dtc whe: tne eerted a wrong sae; . efile phe ais i agate statin vant he uiony nt & the Instrument is obtained for an ilegs! consideration; eeenn ‘stot ae 25, One of the legal effects of crossing a check: 2. it may be encashed; ‘ie may only ba deposited by the one who has an account witha bank; the check eannat be negotiated; 4. the endorse may be a holder In due course. ~{. 16. The date of maturity ofan instrument payable on demand is determined by the date of: ‘isu; ©. presentment, negotiation; . instrument || 27. Where an instrument fs nagotited back toa prior party, such party may further negotiate the same but he snot entitled to enforce payment thereof against these parties to wham he was personally Hable: ‘a. allparties; Buintervening parties; Immediate parties; d. remote perties. 118, when 2 negotiable instrument payable to order i transferred for value without indorsement, what isthe legal effect? 2. its considered an equitable assignment; “ ». the transferee sa holder; ‘c owmership of the instrument i held in abeyance; the holder has the right to demand indorsement from the transferor; 19, Marlo issued a promissory note In favor of Jolina for P3,000.00. Jona endarsad ito Divine as» gift forthe latter's forthcoming 17° birthday, and immediately thereafter Divine indorsed the note to Tanya, ‘Upon maturity of the note, Mario dishonored ft. What defenses are avaliable to the parties? ‘2. real defense of minority only; black of consideration and minority 2s real defenses; personal defense of lack of consideration only, lack of consideration as personal defense and minority as real defense, 20. A partyin whose favor a person, without receiving value therefor, signs an instrument for the purpose of lending his ~ credit and enable this party to raise money upon it: '2. accommodation party; b. Immediate party; c.remoteparty; d. accommodated party. + 23. The acceptor, by accepting the instrument, admits the existence of the payee and his then capacity te indorse, who ‘among the following persons is subject to the same warranty? a. maker; b. drawee; Indorsee; d-none of the above; 22. An irregular indorser, In contrast to a person negotiating by delivery: ‘2 admits that the Instrument I, 2¢ the time of his indorsement, valid and subsisting; b. admits that he has good ttle to the Instrument; c warrants the instrument i genuine and in all respects what It purports to be; 4. warrants that all rior parties had capacity to contract. 25, Which ofthe following does nat preclude the acceptor from asserting tas a defense? 4. forgary ofthe Indorser's signature; '. the drawer s fictitious; want or fallure of consideration between him and the drawer; 4. he has no funds belonging to the drawer with which to pay the bil, 24, tt denotes an indorsament for some purpose other than to transfer the instrument: A-asomalous indorvement; ——babnormel Indorsement; _¢. irregutar indorsement; d. a of the these. 25. Which of the fallowing renders the bil non-negotiable: {aI payable to one or several payees; 2 bill payable to two or more payees jointly;et bil addressed to two oF more érawees in the alternative; il addressed to two or more drawees jlnty. 26 Its descritive rather than restrictive: 2. Vesting the tl inthe indorse in trust for the indore, An Indorer ining his tab, A statement ofthe traacton which gees st othe lstrument: ‘An indication of a particulae fund out of which rlmbursement is to be made: arupunen ns smn seems tae maaan era &: Acceleration nvse dependent onthe creditor Extension cause at the option of the eredor Debtor’ right to extene time of payment ata fixed period afer mat: 6. Aczaeration nvse dependent on the Gbtor. 128. The unconditional order in 2 negotiabie instrument means n ‘a, Language of negotiabiity; ‘eA command; i. Authority 0 pay payee; an expression of consent to negotiate. 2, spe semen ening ue wo ms oc ona. or pn tn fe ne” nes ‘example ot: '. Payable on a fined time; B parable at ixea peri ater the occurence of the specified events ‘c.Payable on the occurrence of specified event; 4. Payable on a determinable future time. ‘30. This negovable instrument is aptly deserioed as 9 substitute for money: 4. Checks b. Promissory nate: "c'pitof exchange; ¢-Allof me above. spay to the ore of vy 2,000.00 and reimburse yourself from ‘commission with you" Is: 234. Thisinstrument 'b, A negotiable instrument; An order instrument; All ofthe above; fa. Ademmand instrumeit; +32, An instrument payable to orders negotiated by: Indorsement alonc: bindorsement completes by delivery: resentment for acceptance may be made mandatory only 1 Bits of exchange © Checks; «Delivery ont 4. Any of the above, 433. In some Instances, ‘a Promissory notes; ‘d, Checks and bills of exchange. |34, Acceptance is mportent In the determination of: ‘a.liablity; —_b, Negotiabiltys «¢ Assignability; 4. Allof the above. 435. te means the transfer of possession, actual or constructive, from one person to ano ine ‘a.acceptance; _.ingorsement; € delivery; 4d, presentment. 34. 36. A non-negotiable instrument: ‘a."Three years after Mary's wedding, | promise to pay to the order of Grace, 1P5,000.00. (Sgd) Beverty;” 'b."Five days efter demand, please credit Kate or order P5,000.00. To Dianne. (Sgd.) Witmark;” ‘c“Seven days berore Christmas of 2020, | promise t0| pay to the order of Jino P5,000.00. (See) Elyza," d.“Ipromise to pay Joy or assignee PS,000.00. (Sed. salina.” 37. Which pf the following is egotindle? /m\ agree to pay bearer or ortier PS,000.00 on demand (Ses.) Jenny; ‘b."Due to Hazel or order $5,000.00 (Sed. Lesli” 6" promise to pay bearer Grace PS,000.00 (Sgd.) Dette:” 4471 bind myset to pay Russel PS,000.00 (Sed) Joma.” 38, A negotiable Instrument is defined as: 2,4 medlum of exchange Intended as e substitute for money, b, legal tender that produces the effect of payment; + ten coat tak unconditional promises ‘orders the payment of a fixed amount of money; J. a.redit instrument which increases credit circulation. 59/39. Who are primary proected by the Negotiable Instrument Law?