Fact Pattern 19-2 Tom Draws a Check, on His Account in State Bank

question 71

Multiple Choice

Fact Pattern 19-2
Tom draws a check, on his account in State Bank in New York, payable to Digital Media, Inc., in San Francisco. Digital deposits the check in its account at First National Bank.
-Refer to Fact Pattern 19-2. Tom's bank is

• A) the cashing bank.
• B) the depositary bank.
• C) the intermediary bank.
• D) the payor bank.

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Definitions:

Binomial Random Variable

A type of random variable that takes on a fixed number of possible outcomes, with each outcome having a constant probability of occurrence in each independent trial.

Normal Curve

A symmetric, bell-shaped curve representing the distribution of a set of data where most occurrences take place near the mean and probabilities for values taper off equally on both sides.

Continuity Correction

An adjustment made when approximating a discrete distribution with a continuous distribution.

Normal Approximation

A method of estimating the distribution of a sample statistic using the normal distribution, often applied when the sample size is large.