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Details Title: Chapter 5 Flash Cards Description: STUDY GUIDE Total Flash Cards: 39 Created: 03/07/2007 05:24:33	To study from this set of flash cards, or to create your own your own study flash cards, register HERE. If you are already a registered user, CLICK HERE.
Cards Term Negotiable Instrument Definition a written order to pay a sum of money, either to a specified party or to the person who holds it. They include drafts, bills of exchange, and some promissory notes, and checks. Term What is an instrument? Definition In the broadest sense, almost any agreed upon medium of exchange could be considered a negotiable instrument. In day-to-day banking, a negotiable instrument usually refers to checks, bills of exchange, and some types of promissory notes. Term Bearer Instrument Definition payable to the bearer, or it may be an instrument with highly specified terms. Term Check Number Definition the number of the check being written. Term Date Definition the date the check is written. Term Amount Definition spaces aloud for the amount of check to entered in both numbers and words. Term Payee Definition receiver of the funds. Term Signature Definition valid signature of the maker of the check. Term Memo Definition optional entry to note the checks purpose. Term Identification Numbers Definition show the check number, the bank routing number, and the account number. Term Draft Definition an order signed by one party that is addressed to another party directing the drawee to pay someone the amount indicated on the draft. Term Bill of Exchange Definition a negotiable and unconditional written order, such as a check, draft, or trade agreement, addressed by one party to another. The receiver of the bill must pay the specified sum or deliver specified goods on demand or at a specified time. Bills of Exchange are a common form of internationally negotiable instruments. Term Promissory Note Definition a written promise to pay at a fixed or determinable future time a sum of money to a specified individual. Term Elements of Negotiability Definition when you present a check to a bank for payment, the bank has to assure that the check meets certain legal requirement. Term Bank Endorsement Definition sometimes called an open endorsement, is the least secure of the four main types of endorsement. Term Restictive Endorsement Definition limits the use of the instrument to a means specified by the endorser. " for deposit only. Term Restrictive Endorsement Definition sometimes called a special endorsement, transfers the check to another. Term Qualified Endorsement Definition attempt to limit the liability of the endorser without limiting an instrument's further negotiability. "without recourse" Term Federal Reserve Act of 1913 Definition also established the structure of our banking system, the Federal Reserve Act of 1913 also established the fundamental relationship between the Federal Reserve and banks, as well as among banks. Term Uniform Commercial Code of 1958 Definition established a consistent code for commercial law transactions. Term Expedited Availability Act of 1987 Definition Passed to combat an abuse of the check payment system practiced by a few banks. Term Charge Card Definition a consumer makes purchases but must pay the account in full at the end of the month. A charge card must be paid off every month. Term Credit Cards Definition allow consumers to pay all or part of their bills each month and finance the unpaid balance. Term Cash Cards Definition are commonly used at an automated teller machine (ATM). - Consumers can get cash, make transfers and deposits, or perform almost any other banking function at the machine by inserting the card and entering a personal identification number (PIN). Term Debit Cards Definition transfer money from a person's designated account to the account of the retailer. Term Smart Cards Definition are credit, debit, or other types of cards with embedded microchips. Term e-checks Definition a digitally guaranteed type of electronic check to be transmitted on the Internet. Electronic Tokens - monetary system based on the exchange of digital money via computer. Term EFT (electronic funds transfer) Definition occur between banks, between banks and the federal reserve, between banks and the government, and between banks and consumers. Term Automated Clearing Houses (ACHs) Definition magnetic tapes exchange among banks read streams of data into computers, ideal for large volumes of smaller payments such as payrolls or recurring payments. Term Fedwire Definition funds transfer system run by the Federal Reserve, handles transfers for federal funds, interbank dealings, and securities transactions. Term A ________ is almost any agreed-upon medium of exchange. Definition instrument Term Drawee Definition The party on which an order for the payment of money is drawn. Term drafter Definition a writer of a draft Term Payee Definition One to whom money is paid Term Drawer Definition One that draws, especially one that draws an order for the payment of money. Term A _________ endorsement limits the use of the instrument to a means specified by the endorser. Definition restrictive Term A ___________ endorsement is an attempt to limit the liability of the endorser, without limiting an instruments further negotiability. Definition Qualified Term A ___________ endorsement is also called an Open endorsement. It is the least secure of all the types of endorsements and only requires the signature of the holder. Definition Blank Term A ___________ endorsement transfers the check to another qualified party. Definition Full