Which of the Following Is Correct with Respect to a Bank

question 17

Multiple Choice

Which of the following is correct with respect to a bank customer's duty to discover and report unauthorized signatures?

• A) The customer is required to exercise reasonable care and promptness to examine the bank statement.
• B) A customer's duty of examination includes checking the signatures of payees or indorsers.
• C) The bank is liable on all items with unauthorized signatures even if these canceled checks were returned to the customer four years prior to the discovery of the alterations.
• D) The bank is not required to exercise ordinary care in paying the items.

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Definitions:

Magnetism

A natural occurrence resulting from electric charge movement, leading to objects attracting and repelling each other.

Hardness

The measure of a material's resistance to deformation, typically by indentation, abrasion, or cutting.

Streak

A long, thin line or mark of a different substance or color from its surroundings.

Cleavage

A property of minerals that allows them to break along smooth, flat surfaces based on their crystal structure.