NEGOTIABLE INTRUMENTS

1. It is the transfer of a negotiable instrument form one person to another made in such a manner as to
constitute the transferee the holder thereof.

A. Assignment
B. Negotiation
C. Issuance
D. Trade

2. An instrument which is not negotiable

A. Certificate of deposit
B. Due bill
C. Letter of credit
D. Draft

3. A letter requesting one person to make advances to a third person on the credit of the writer.

A. Letter of credit
B. Letter of debit
C. Letter of order
D. Postal money order

4. They are beyond the scope of the negotiable instruments law and are governed by other laws.

A. Bill of exchange
B. Coupon bond
C. Time draft
D. Bill of lading

5. A document of security pursuant to which a bank acquires a security interest on the goods under this

A. Collateral
B. Trust receipt
C. Treasury warrant
D. Certificate of deposit

6. It involves a transfer of rights under a contract

A. Assignment
B. Negotiation
C. Issuance
D. Trade
7. A draft drawn by the seller on the purchaser of goods and accepted by the later by signing it as a
drawee.

A. Banker's acceptance
B. Trade acceptance
C. Time draft
D. Buyer acceptance

8. The person issuing a promissory note

A. Referee in case of need

B. Indorser
C. Maker
D. Payee

9. A bill drawn in one state or country payable in another state of country

A. Domestic bill
B. Sight draft
C. Inland bill
D. Foreign bill

10. The person who receives the indorsed instrument

A. Indorsee
B. Drawee
C. Payee
D. Indorder

11. One where the name of the payee is specified in the negotiated instrument

A. Facultative indorsement
B. Special indorsement
C. Specific indorsement
D. Restrictive indorsement

12. The party upon whom the bill is drawn

A. Payee
B. Indorsee
C. Drawee
D. Acceptee

13. It is one by which the indorser binds himself to pay upon no other condition than the failure of the
prior parties to do so
 A. Unconditional indorsement
B. Non-restrictive indorsement
C. Qualified indorsement
D. Absolute indorsement

14. One who possesses of the note or bill

A. Indorser
B. Drawer
C. Holder
D. Maker

15. It means "indorsee's own risk"

A. Withour recourse
B. Cognovit actionem
C. Sans revival
D. In cognito

16. It is a slip of paper physically attached to the instrument so as to become part of it.

A. Scrap
B. Allonge
C. Subcontract
D. Promissory note

17. It is the writing of the name of the payee on the instrument with the intent either to transfer the
title of the same or to strengthen the security of the holder by assuming a contingent liability for its
future payment

A. Negotiation
B. Indorsement
C. Assignment
D. Issuance

18. The person named by the drawer or indorser as the one to whom the holder may resort in case of
need

A. Maker
B. Court
C. Referee in case of need
D. Negotiator in case of need

19. One which specifies ni particular name

 A. Blank indorsement
B. Non-restrictive indorsement
C. General indorsement
D. Successive indorsement

20. The counterfeit-making or fraudulent alteration if any writing and may consist in the signing of
another's name or alteration or an instrument in the name, amount, description of the person

A. Spoliation
B. Material alteration
C. Prescription
D. Forgery

21. A bill of exchange drawn on a bank payable on demand

A. Draft
B. Check
C. Certificate of deposit
D. Letter of credit

22. One who has given a valuable consideration for the instrument issued or negotiated to him

A. Holder for value

B. Holder in due course
C. Holder not in due course
D. Holder in good faith

23. An indorsement for some purpose other than to transfer the instrument or by one not in the actual
chain of title

A. Restrictive indorsement
B. Irregular indorsement
C. Special indorsement
D. Conditional indorsement

24. It is a command or imperative direction

A. Promise
B. Payment
C. Order
D. Condition

25. Parties who were not in direct contractual relation to each other

A. Remote parties
B. Immediate parties
 C. Primary parties
D. Secondary parties

26. The instrument is payable to the order of two or more payees or indorsees who are not partners

A. Special
B. Facultative
C. Successive
D. Joint

27. It exists in those cases in which a person, without negligence, has signed an instrument which was a
negotiable instrument but was deceived as to the character of the instrument and without knowledge of
it

A. Fraud in cesio lanto

B. Fraud in factum
C. Fraud
D. Dishonour

28. The person who takes the instrument free of most defenses or adverse claims to it by other parties

A. Holder for value

B. Holder in due course
C. Holder not in due course
D. Holder in good faith

29. When material alteration is made by a stranger

A. Invalid alteration
B. Spoliation
C. Exfoliation
D. Immaterial alteration

30. It refers to the act of the holder of a negotiable instrument of exhibiting a note to the maker and
demanding payment

A. Presentment
B. Presentation
C. Indorsement
D. Negotiation

31. It is one which constitutes the indorser a mere assignor of the title to the instrument

A. Special indorsement
B. Facultative indorsement
 C. Qualified indorsement
D. Joint indorsement

32. Indorsers are liable prima facie in the order in which they indorse

A. Successive Indorsement
B. Special Indorsement
C. Regular Indorsement
D. Qualified Indorsement

33. The act of which the drawee manifests his consent to comply with the request contained on the bill
of exchange directed to him

A. Presentment
B. Acceptance
C. Dishonor
D. Indorsement

34. These are grounds or reasons pleaded or offered by the defendant in a case, showing why the
plaintiff should not be given the relief he seek.

A. Rebuttal
B. Evidences
C. Defenses
D. Alibi

35. It is the written confession made by a defendant admitting the merits of the action brought against
him or her by a plaintiff

A. Sans Recourse
B. Ab Initio
C. Evidence
D. Cognovit Actionem

36. A government warrant for the payment of money such as that issued in favour of a public officer or
employee covering payment or replenishment of cash advances for official expenditures

A. Bill of lading
B. Treasury warrant
C. Office warrant
D. Certificate of deposit

37. It is an order for the payment of money to the payee named therein drawn by one post office upon
another under authority of law.
 A. Government grant
B. Warehouse receipt
C. Postal money order
D. Bill of exchange

38. It is the first delivery of the instrument complete in form, to a person who takes it as a holder

A. Issue
B. Negotiation
C. Assignment
D. Indorsement

39. Indorser enlarges his liability by waiving the usual demand and notice if dishonor.

A. Legal Delay
B. Anomalous Indorsement
C. Conditional Indorsement
D. Facultative Indorsement

40. It refer to any change in the instrument which affects the liability of the parties

A. Material Alteration
B. Spoliation
C. Forgery
D. Discharge

41. Those assertable against all parties, both immediate and remote, including holders in due course or
holder through the latter.

A. Original Defenses
B. Real Defenses
C. Personal Defenses
D. Objective Defenses

42. One in whose favor a person without receiving value therefore, signs as instrument for the purpose
of lending his credit and enabling said party to raise money upon it

A. Remote Party
B. Accommodation Party
C. Immediate Party
D. Lending Party

43. This occurs when the presented instrument is not accepted nor paid.

A. Dishonor
B. Delay
 C. Shame
D. Liability

44. Those available to prior parties among available to prior parties among themselves but which are not
good against a holder in due course.

A. Original Defenses
B. Personal Defenses
C. Objective Defenses
D. Real Defenses

45. Persons who are absolutely required to pay the same.

A. Maker
B. Drawee
C. Payee
D. Indorser

46. It is an undertaking by a stranger to a bill after protest for the benefit of any party liable thereon.

A. Acceptance for Payment

B. Presentment for Payment
C. Acceptance for Honor
D. Presentment for Honor

47. It is the production or exhibition of a bill of exchange to the drawee for his acceptance or payment

A. Presentment for Acceptance

B. Presentment for Payment
C. Acceptance for Honor
D. Presentment for Honor

48. It means “from the beginning”

A. Sans Recourse
B. Ab Initio
C. Prima Facie
D. Cognovit Actionem

49. It is one which the indorser imposes some other condition to his liability, or on the indorsee’s right
to collect the proceeds of the instrument.

A. Absolute
B. Conditional
C. Successive
D. Anomalous
50. Parties who were not in direct contractual relation to each other

A. Immediate Party
B. Remote Party
C. Third Person
D. Strangers

51. The person in possession of a bill

A. Payee
B. Indorser
C. Bearer
D. Drawee

52. It is a written instrument signed by a proper officer of a corporation stating that the person named
therein is the owner of a designated number of shares of its stock.

A. Articles of incorporation
B. Pawn ticket
C. Certificate of stock
D. Certificate of Indorsement

53. It refers to written promises or obligations that arise out of commercial transactions from the use of
such instruments as negotiable instruments

A. Commerce
B. Bill of Exchange
C. Commercial Paper
D. Promissory Note

54. It is prima facie evidence of his intention to be bound as either maker or drawer.

A. Signature
B. Agreement
C. Contract
D. Payment

55. An instrument is _______ when it contains a date earlier than the true date of its issuance.

A. Post-dated
B. Pre-dated
C. Ante-dated
D. Out-dated

56. It means the transfer of possession from one person to another

 A. Conveyance
B. Delivery
C. Movement
D. Distribution

57. It is the immediate, direct, or essential reason which induces a party to enter into a contract.

A. Condition
B. Consideration
C. Purpose
D. Reason

58. It is ant consideration sufficient to support a simple contract

A. Value
B. Benefit
C. Cause
D. Consideration

59. An instrument is _______ when it contains a date later than the true date of its issuance.

A. Post-dated
B. Pre-dated
C. Ante-dated
D. Out-dated

60. It means a total lack of any valid consideration for the contract of which the alleged contract must
fail.

A. Failure of Consideration
B. Failure of Purpose
C. Absence of Consideration
D. Absence of value

61. It is the failure or refusal of one of the parties to do, perform, or comply with the consideration
agreed upon.

A. Failure of value
B. Failure of consideration
C. Failure of benefit
D. Failure of Accommodation

62. It means a resort to a person who is secondarily liable after the default of the person who is
primarily liable,
 A. Recourse
B. Course
C. Liability
D. Remedy

63. A person who qualifies as a holder but does not meet all the conditions to qualify as a holder in due
course is called?

A. Payee
B. Maker
C. Assignee
D. Bearer

64. It means the honesty in fact in the transaction concerned

A. Diligence
B. Good Faith
C. Bad Faith
D. Negligence

65. It is where a person, by the use of violence and intimidation, forced another to indorse a promissory
note in favour of himself.

A. Fraud
B. Duress
C. Bad Faith
D. Compulsion

66. It is that which relates to the quality, quantity, value, or character of the consideration of the
instrument.

A. Fraud in Factum
B. Fraud in Inducement
C. Fraud in esse contractus
D. Fraud in breach of good faith

67. It refers to the obligation of a party to a negotiable instrument to pay the same according to its
terms.

A. Liability
B. Personal Liability
C. Personal Obligation
D. Legal Responsibility
68. It means that he must have knowledge of facts which renders it dishonest for him to take a
particular piece of negotiable paper.

A. Bad Faith
B. Negligence
C. Good Faith
D. Fraud

69. A note given to stifle a criminal prosecution or in consideration of the payee killing a person is
invalid.

A. Duress
B. Fraud
C. Illegal Consideration
D. Fear

70. The holder in due course must have acquired the instrument through negotiation and an instrument
is issued and not negotiated to a payee.

A. Affirmative view
B. Contrary View
C. Positive view
D. Negative View

71. When each one of them is liable for the entire amount of the instrument

A. Personal Liability
B. Solidary Liability
C. Joint Liability
D. Real Liability

72. If the instrument is not exhibited, the presentment would be ineffectual as the debtor is entitle to
see the instrument and demand its surrender upon payment

A. Presentment without exhibition

B. Presentment without due course
C. Invalid Presentment
D. Failure of Presentment

73. The instrument may be presented for payment before 12:00 noon on Saturday or on Monday, at the
option of the holder.

A. On demand
B. On a Holiday
 C. On a Saturday
D. On a Sunday

74. Brokers employed to buy stock represented that they bought the stock and received a check
therefore, but had not, in fact, bought.

A. Duress
B. Fraud
C. Illegal Consideration
D. Fear

75. Where the instrument had been stolen.

A. Duress
B. Fraud
C. Illegal Consideration
D. Other unlawful means

76. Where the payee of a note negotiated it after receiving payment from the maker.

A. Negotiation in breach of faith

B. Fraud
C. Illegal Consideration
D. Other unlawful means

77. It holds that payee may be a holder in due course under any of the circumstances in which he meets
the requirements in section 52.

A. Contrary View
B. Affirmative View
C. Positive View
D. Negative View

78. It means that indorsement is not necessary because the instrument is payable to bearer.

A. Qualified Indorsement
B. Regular Indorsement
C. Negotiation by delivery
D. Negotiation in breach of faith

79. The liability of a person negotiating a bearer instrument by mere delivery is the same as the person
who negotiates by qualified indorsement.

A. Liability merely as assignor of credit

B. Liability merely as assignor of debit
 C. Liability merely as assignor of promissory note
D. Liability merely as assignor of bill of exchange

80. Presentment for payment cannot be made on _____.

A. Saturday
B. Labor Day
C. The date of his birth
D. Demand

81. It is bringing to the knowledge of the drawer or indoser of an instrument the fact that a specified
negotiable instrument has not been accepted or paid.

A. Dishonor
B. Notice of Dishonor
C. Protest
D. Notice of Delay

82. It is the intentional abandonment of a known right.

A. Protest
B. Delay
C. Waiver
D. Renouncement

83. It is the formal Instrument executed usually by a notary public certifying that the legal steps are
necessary to fix the liability of the drawee and the indorders have been taken.

A. Protest
B. Notice
C. Waiver
D. Delay

84. It implies active research

A. Diligence
B. Negligence
C. Reasonable Diligence
D. Extraordinary Diligence

85. It means a release of all parties whether primary or secondary, from the obligations arising under
the instrument rendering it without force and effect and no longer negotiable

A. Negotiation by breach of faith

B. Discharge of an instrument
 C. Waiver of demand
D. Fraud in esse contractus

86. The effect of ______ is to discharge the instrument and all prior parties thereto who did not give
their consent to such alteration.

A. Material Alteration
B. Alteration by a party
C. Spoliation
D. Alteration by a stranger

87. A _____ drawn payable to the drawer’s own order is complete without indorsement, provided it has
been accepted by the drawee

A. Check
B. Bill
C. Note
D. Contract

88. It is a bill of exchange payable on demand or at sight

A. Draft
B. Check
C. Trade Acceptance
D. Bill

89. When a draft is drawn by a bank against its branch or another bank.

A. Bank Draft
B. Draft
C. Check
D. Bill of exchange

90. If the draft is drawn by the seller on the bank

A. Banker’s acceptance
B. Draft
C. Check
D. Bill of exchange

91. These are loan agreements made by a bank at the request of a customer that the bank will pay or
honor drafts drawn by the seller on the buyer up to a stated amount on compliance with the conditions
specified in the credit.

A. Letter of deposit
B. Certificate of deposit
 C. Letter of credit
D. Certificate of credit

92. A bill payable 30 days after sight.

A. Bill payable after sight

B. Bill payable before sight
C. Bill payable after demand
D. Bill payable elsewhere

93. It is one made by the holder of a bill after it has been accepted but before it matures

A. Protest
B. Protest for better security
C. Protest in case of need
D. Legal Protest

94. It is also called accepted supra protest

A. Acceptance for honor

B. Acceptance for payment
C. Acceptance for protest
D. Acceptance

95. The acceptor is liable ________.

A. Primarily
B. Secondarily
C. Solidary
D. Jointly

96. Another tem for payment for honor

A. Payment supra protest

B. Payment Cognitio
C. Esse Payment
D. Payment ultra protest

97. Payment for honor is made by ________.

A. Notary public
B. Creditor
C. Any person
D. Holder

98. It is one composed of several parts.

 A. Bill of exchange
B. Bill in sets
C. Pro-note
D. Foreign Bill

99. These are usually availed of in case where a bill had to be sent to a distant place through some
conveyance

A. Bill of exchange
B. Bill in sets
C. Pro-note
D. Foreign Bill

100. He is required to accept only one part of a bill drawn in a set

A. Holder
B. Drawee
C. Payee
D. Drawer

101. The _____ is liable to each person to whom he has indorsed a part of the bill

A. Holder
B. Drawee
C. Payee
D. Drawer

102. The _____ does not warrant every part of the bill in a set that is indorsed but only the part
accepted by him.

A. Holder
B. Drawee
C. Payee
D. Drawer

103. A _______________ is not complete until indorsed by him

A. Promissory note
B. Promissory note payable to bearer
C. Promissory note payable to maker’s own order
D. Promissory note payable to payee

104. It is issued by the bank when cash or checks are deposited in a checking account

A. Debit card
B. Deposit Slip
 C. Certificate of deposit
D. Checking deposit

105. It is most commonly a time deposit in a bank

A. Debit card
B. Deposit Slip
C. Certificate of deposit
D. Checking deposit

106. It is an evidence of indebtedness issued by a public or private corporation

A. Bond
B. Check
C. Bill
D. Receipt

107. It runs for a longer period than a promissory note and is issued for debts of substantially larger
amount.

A. Bond
B. Check
C. Bill
D. Receipt

108. It is one payable only to the person whose name appears on the face of the certificate and books of
the company.

A. Bond
B. Special Bond
C. Registered Bond
D. Coupon Bond

109. It is transferable by the registration of the transferee’s name in the books of the company

A. Bond
B. Special Bond
C. Registered Bond
D. Coupon Bond

110. It is one to which are attached coupons which entitle the holder to interest when due

A. Bond
B. Special Bond
C. Registered Bond
D. Coupon Bond
111. The interest for such may be detached or negotiated just like a promissory notes independent of
the main instrument

A. Bond
B. Special Bond
C. Registered Bond
D. Coupon Bond

112. It is an instrument issued by a bank for circulation as money payable to bearer on demand

A. Bank draft
B. Bank note
C. Certificate of deposit
D. Savings account

113. It is a promissory note which shows on its face an acknowledgment by a person of his indebtedness
to another.

A. Due bill
B. Special Bond
C. Draft
D. Coupon Bond

114. The instrument usually has the word “due” on its face.

A. Due bill
B. Special Bond
C. Draft
D. Coupon Bond

115. It is a kind of security contract

A. Due bill
B. Mortgage Note
C. Chattel Note
D. Coupon Bond

116. It is secured by Personal Property

A. Due bill
B. Mortgage Note
C. Chattel Note
D. Coupon Bond

117. It is secured by real property

 A. Due bill
B. Mortgage Note
C. Chattel Mortgage Note
D. Real-estate Mortgage Note

118. It is used to secure the purchase price of goods

A. Due bill
B. Title-retaining note
C. Chattel Note
D. Coupon Bond

119. This type is secured by conditional sales contract which ordinarily provides that the title to the
goods shall remain in the payee’s name until fully paid.

A. Due bill
B. Title-retaining note
C. Chattel Note
D. Coupon Bond

120. It is used when the maker pledges securities to the payee to secure the payment of the amount of
the note.

A. Due bill
B. Title-retaining note
C. Chattel Note
D. Collateral Note

121. Banks also use a device called _____ for short-term unsecured loans or loans made without
collateral

A. Signature Note
B. Title-retaining note
C. Chattel Note
D. Coupon Bond

122. This is note to which is added a power of attorney enabling the payee to take judgement against
the maker without formality of a trial if the note is not paid on due date

A. Judgement Note
B. Title-retaining note
C. Chattel Note
D. Coupon Bond

123. It is a note payable is specified or periodic instalments at predetermined times

 A. Due bill
B. Title-retaining note
C. Chattel Note
D. Installment Note

124. A written order addressed to a bank or persons carrying on the business of banking by a party
having money in their hands requesting them to pay on presentment to a person named herein or to his
order, a named sum of money

A. Bond
B. Check
C. Bill
D. Receipt

125. A _____ is supposed to be drawn against previous deposits of funds

A. Bond
B. Check
C. Bill
D. Receipt

126. A_____ need not be presented for acceptance

A. Note
B. Check
C. Bill
D. Receipt

127. It is like an ordinary check except that the word “memo” is written upon its face

A. Memorandum Check
B. Check
C. Bill
D. Stale Check

128. It is one drawn by the cashier of a bank upon the bank itself

A. Memorandum Check
B. Check
C. Cashier’s Check
D. Stale Check

129. It is payable on demand to a payee.

A. Memorandum Check
B. Check
 C. Cashier’s Check
D. Stale Check

130. It operates as an assignment of funds represented by the check to credit of the payee or holder.

A. Memorandum Check
B. Check
C. Cashier’s Check
D. Stale Check

131. It is really the bank’s own check and may be treated as a promissory note

A. Memorandum Check
B. Check
C. Cashier’s Check
D. Stale Check

132. It is an accepted practice in the business sector that a _____ is deemed as cash

A. Memorandum Check
B. Check
C. Cashier’s Check
D. Manager’s Check

133. It is one drawn by the bank’s manager upon the bank itself.

A. Memorandum Check
B. Check
C. Cashier’s Check
D. Manager’s Check

134. It is similar to the cashier’s check both as to effect and use

A. Memorandum Check
B. Check
C. Cashier’s Check
D. Manager’s Check

135. It is one upon which the holder’s signature must appear twice

A. Memorandum Check
B. Traveler’s Check
C. Cashier’s Check
D. Manager’s Check
136. Its purpose is to provide is to provide the traveller safe and convenience method by which to
supply himself with funds in almost all parts of the civilized world without the hazard of carrying the
money on his person.

A. Memorandum Check
B. Traveler’s Check
C. Cashier’s Check
D. Manager’s Check

137. _____ is not checks but drafts because the drawee is ordinarily not a bank

A. Memorandum Check
B. Traveler’s Check
C. Cashier’s Check
D. Manager’s Check

138. It is one which bears upon its face an agreement by the drawee bank that the check will be paid on
presentation

A. Memorandum Check
B. Traveler’s Check
C. Certified Check
D. Manager’s Check

139. The purpose of this check is to enable the holder to use it as money

A. Memorandum Check
B. Traveler’s Check
C. Certified Check
D. Manager’s Check

140. The usual practice is by stamping or writing the word “certified” upon the check.

A. Memorandum Check
B. Traveler’s Check
C. Certified Check
D. Manager’s Check

141. It is one which bears across its face two parallel lines drawn diagonally, usually on the upper left
side

A. Memorandum Check
B. Crossed-Check
C. Cashier’s Check
D. Manager’s Check
142. The name of the particular bank or company is written between the parallel lines in which case the
drawee bank must pay the check upon presentment by such bank

A. Crossed-specifically Check
B. Traveler’s Check
C. Crossed-Generally Check
D. Manager’s Check

143. Only the words “and Co.” are written between the parallel lines

A. Crossed-specifically Check
B. Traveler’s Check
C. Crossed-Generally Check
D. Manager’s Check

144. When nothing is written in between the parallel lines.

A. Crossed-specifically Check
B. Traveler’s Check
C. Crossed-Generally Check
D. Manager’s Check

145. The drawee bank must pay the check through the intervention of some bank or banker

A. Crossed-specifically Check
B. Traveler’s Check
C. Crossed-Generally Check
D. Manager’s Check

146. It is deposited with a bank by the holder where he keeps an account and the bank takes charge of
the collection

A. Crossed-specifically Check
B. Traveler’s Check
C. Crossed-Generally Check
D. Manager’s Check

147. He deposits it with the bank indicated between the parallel lines

A. Crossed-specifically Check
B. Traveler’s Check
C. Crossed-Generally Check
D. Manager’s Check

148. It can only be deposited but may not be converted into cash
 A. Crossed Check
B. Traveler’s Check
C. Crossed-Generally Check
D. Manager’s Check

149. The purpose of such is to insure payment to the payee particularly when it is forwarded by mail or
when it is entrusted to an agent but it does not destroy negotiability

A. Crossed-specifically Check
B. Traveler’s Check
C. Crossed Check
D. Manager’s Check

150. It is one which has not been presented for payment within a reasonable time after its issue.

A. Stale Check
B. Traveler’s Check
C. Crossed Check
D. Manager’s Check

151. It is valueless and should not be paid

A. Crossed-specifically Check
B. Stale Check
C. Crossed-Generally Check
D. Manager’s Check

152. Banking practice presently regards a stale check outstanding for ___________.

A. Less than 6 month

B. More than 6 months
C. 6 months
D. 3 months

153. The ______ is not discharged by the mere delay in the presentation of the check for payment if he
does not suffer any loss from the delay.

A. Holder
B. Drawer
C. Payee
D. Bearer

154. An agreement by the bank against whom the check will be paid when presented for payment

A. Certification
B. Presentment
 C. Registration
D. Acceptance

155. It is done by stamping the word “certified” on the face of the check

A. Certification
B. Presentment
C. Registration
D. Acceptance

156. It enables the person not well acquainted with each other to close promptly business transactions
since the holder knows that he can compel the drawee bank to cash it.

A. Certification
B. Presentment
C. Registration
D. Acceptance

157. If the _____ procures the certification of a check, the drawer and the indorser are discharged.

A. Holder
B. Indorsee
C. Payee
D. Bearer

158. Until payment is made by the _____, its issuance and circulation have no effect on the funds on the
drawer on the bank nor do they discharge the debt in payment for which the check was issued

A. Holder
B. Indorsee
C. Drawee
D. Bearer

159. The moment a check is certified, the funds cease to be under the control of the ________.

A. Holder
B. Indorsee
C. Payee
D. Drawer

160. A ____ is constituted from the moment a person receives a thing belonging to another with the
obligation of safely keeping it ad returning the same.

A. Delivery
B. Deposit
 C. Donation
D. Transfer

161. A _______ is really a loan which creates the relationship of a debtor and creditor

A. Bank Loan
B. Bank Deposit
C. Certificate of deposit
D. Letter of credit

162. The ____ is bound to honor the check of its depositor for sums not in excess of the amount of his
deposit

A. Holder
B. Bank
C. Payee
D. Bearer

163. The first bank to receive a check for payment is the ______.

A. Intermediate Bank
B. Depository Bank
C. Drawer Bank
D. Payor Bank

164. _____ is any bank to which a check is transferred in the course of the collection process

A. Intermediate Bank
B. Depository Bank
C. Drawer Bank
D. Payor Bank

165. Any bank that handles a check during some phase of the collection process

A. Intermediate Bank
B. Depository Bank
C. Collecting Bank
D. Payor Bank

166. The bank on which a check is drawn

A. Intermediate Bank
B. Depository Bank
C. Collecting Bank
D. Payor Bank
167. In payment for honor, the person whose payment will discharge the ______ of parties to the bill
given the preference

A. Greatest Number
B. Least Number
C. Majority Number
D. Minority Number

168. ______ may be availed of when the holder, knowing that the bill has already been dishonoured for
non-payment, does not want to indorse the bill and thereby incur the liabilities of an indorser specified
under section 66.

A. Payment for Acceptance

B. Payment for Honor
C. Payment for Notice
D. Payment on Demand

169. If the ______ for honor does not pay the bill, the holder must protest the bill for non-payment of
the former for honor.

A. Acceptor
B. Drawer
C. Payee
D. Bearer

170. These serve as a medium of credit transaction, except:

A. Promissory Note
B. Trust Receipt
C. Bond
D. Draft

171. It is that quality or attribute of a bill or note whereby it may pass from one person to another
similar to money

A. Issued
B. Transferability
C. Negotiability
D. Assigned

172. The most Important feature of negotiable instruments

A. Assignable
B. Transferability
 C. Negotiability
D. Accumulation of secondary contracts

173. Those in which the issuer has promised to pay

A. Promissory Note
B. Trust Receipt
C. Bond
D. Draft

174. It is without an unconditional promise or order to pay a sum certain in money, it is for goods.

A. Treasury warrant
B. Bill of lading
C. Bill of Exchange
D. Letter of credit

175. It is a document of title, without an unconditional promise or order to pay a sum certain in money

A. Treasury warrant
B. Bill of lading
C. Warehouse Receipt
D. Pawn ticket

176. It is not a negotiable instrument under the Negotiable Instruments Law not a negotiable document
of title under Art. 1507

A. Treasury warrant
B. Bill of lading
C. Warehouse Receipt
D. Pawn ticket

177. Transfer of non-negotiable instruments are governed by

A. Provisions of the Civil code

B. Negotiable Instruments Law
C. FRIA Law
D. Mutuum

178. It is commonly referred to as a note

A. Bill of Exchange
B. Bond
C. Promissory Note
D. Draft
179. To whom the promise is made or the instrument is payable

A. Holder
B. Drawee
C. Payee
D. Bearer

180. This means an acceptance completed by delivery or notification

A. Acceptance
B. Protest
C. Action
D. Presentation

181. It includes counterclaim and set-off

A. Acceptance
B. Protest
C. Action
D. Presentation

182. It includes any person or association of persons carrying on the business of banking, whether
incorporated or not

A. Holder
B. Bank
C. Payee
D. Bearer

183. It means the person in possession of a bill or note in which is payable to bearer

A. Holder
B. Drawee
C. Payee
D. Bearer

184. It means bill of exchange

A. Bill
B. Note
C. Draft
D. Check

185. It means negotiable promissory note

 A. Bill
B. Note
C. Draft
D. Check

186. It means transfer of possession from one person to another

A. Bill
B. Note
C. Delivery
D. Check

187. It means payee or indorsee of a bill or note, who is in possession of it

A. Holder
B. Drawee
C. Payee
D. Bearer

188. It means indorsement completed by delivery

A. Acceptance
B. Protest
C. Indorsement
D. Presentation

189. It means negotiable instrument

A. Instrument
B. Bill
C. Note
D. Check

190. It means the first delivery of the instrument, complete in form, to a person who takes it as a holder

A. Acceptance
B. Issue
C. Indorsement
D. Presentation

191. It includes a body of persons, whether incorporated or not

A. Holder
B. Drawee
C. Person
D. Bearer
192. It means valuable consideration

A. Consideration
B. Value
C. Cause
D. Purpose

193. It includes printed

A. Written
B. Public Instrument
C. Allonge
D. Contract

194. It includes Print

A. Written
B. Public Instrument
C. Allonge
D. Writing

195. He is a person liable even though he adds the word “surety” to his signature.

A. Payee
B. Accommodation maker
C. Person
D. Bearer

196. During _____, merchants who engaged in foreign trade adopted the plan of transferring credit
through the use of negotiable paper rather than transferring pgysical money.

A. Medieval Period
B. Twelfth Century
C. Twenty-first Century
D. Renaissance Period

197. It consisted of usages of trade in different departments of commerce proved in court and ratified
by legal decisions.

A. Medieval Period
B. Law Merchant
C. Twelfth Century
D. Renaissance Period

198. This act shall take effect ______ after its publication in the official gazette of the Philippine Islands
shall have been completed.
A. 30 days
B. 60 days
C. 90 days
D. 120 days
ANSWERS

1. B 41. B 81. B
2. C 42. B 82. C
3. A 43. A 83. A
4. D 44. A 84. C
5. B 45. A 85. B
6. A 46. C 86. B
7. B 47. A 87. B
8. C 48. B 88. A
9. D 49. B 89. A
10. A 50. B 90. A
11. B 51. C 91. C
12. C 52. C 92. A
13. D 53. D 93. B
14. C 54. A 94. A
15. A 55. C 95. B
16. B 56. B 96. A
17. B 57. B 97. C
18. C 58. A 98. B
19. A 59. A 99. B
20. D 60. C 100. B
21. B 61. B 101. A
22. A 62. A 102. B
23. B 63. C 103. B
24. C 64. B 104. B
25. A 65. B 105. C
26. D 66. B 106. A
27. B 67. A 107. A
28. B 68. A 108. C
29. B 69. C 109. C
30. A 70. B 110. D
31. C 71. B 111. D
32. A 72. A 112. B
33. B 73. A 113. A
34. C 74. B 114. A
35. D 75. D 115. B
36. B 76. A 116. C
37. C 77. B 117. D
38. A 78. C 118. B
39. D 79. A 119. B
40. A 80. B 120. D
121. A 147. A 173. A
122. A 148. A 174. B
123. D 149. C 175. C
124. B 150. A 176. D
125. B 151. B 177. A
126. B 152. B 178. C
127. A 153. B 179. C
128. C 154. A 180. A
129. C 155. A 181. C
130. C 156. A 182. B
131. C 157. A 183. D
132. C 158. C 184. A
133. D 159. D 185. B
134. D 160. B 186. C
135. B 161. B 187. A
136. B 162. B 188. C
137. B 163. B 189. A
138. C 164. A 190. B
139. C 165. C 191. C
140. C 166. D 192. B
141. B 167. A 193. C
142. A 168. B 194. D
143. C 169. A 195. B
144. C 170. B 196. A
145. C 171. C 197. B
146. C 172. D
198. C