MCQ on Collections and Payments of Cheques

[MCQ on Collections and Payments of Cheque, Banking MCQs, Cheques MCQs, Dishonour of a Cheque MCQ]

 

Banking MCQs
Multiple Choice Questions and Answers
Cheque – Collection and Payments

1. Two main types of cheques are Open Cheque and Crossed Cheques.

2. Open cheques are divided into two parts: Bearer and order cheque.

3. Crossed are of four types - General Crossing, Special Crossing, Account Payee Crossing and Not-Negotiable Crossing.

4. What is open and crossed cheque?

Ans: An open cheque is payable across the counter and crossed cheques are paid through bank accounts.

5. What is bearer cheque?

Ans: Bearer cheque is one which is payable to any payee who present it for payment over the counter of the bank.

6. What is order cheque?            

Ans: Order cheque is a cheque which is payable to a certain person named in the cheque by the drawer or to the order of the payee.

7. What is post-dated cheque?

Ans: If a cheque bears a date later than the date of issue it is termed as post dated cheque.

8. What is ante-dated cheque?

Ans: An ante-dated cheque is one which bears a date earlier than the one on which the cheque is actually drawn.

9. What is stale cheque?

Ans: A cheque which is more than 3 months old is called a stale cheque.

10. What is mutilated cheque?

Ans: Mutilated cheque is a cheque which is turn into two or more pieces.

11. Only drawer of the cheques can cancel a crossing on the cheque.

Ans: True

12. What do you mean by conversion of money?

Ans: Conversion of money means wrongful and unlawful interferences with other person’s property or collecting cheque which is not consistent with the owner’s right of possession.

13. What is Double Crossing?

Ans: Where a cheque bears across its face two separate special crossing i.e. the name of two banks, is termed as double crossing.  A specially crossed cheque is required to be collected through the banker specified in the crossing.

14. Marking of a cheque mean certifying the cheques as good for payment by the banker.

Ans: True

15. Collecting banker can claim protection only in case of crossed cheque.          True

16. Which of the following are the duties of a collecting banker?

a) Due care and diligence in the collection of cheques.

b) Presentation of cheque within a reasonable time

c) Remittance of proceeds of the cheques

d) All of the above

17. The paying banker pays the cheques of his customers by honouring the cheques drawn on him.

Ans: True

18. What is forged instruments and forgery of drawer’s signature?

Ans: A cheque is called forged instrument when forgery takes place in signature of the drawer, signature of the endorser, and alteration in name of the payee, alteration in amount, alteration in date etc. validated by forged signature. Forgery of drawer’s signature is void and payee will not be able to enforce payment. In case such payee gets payment by mistake such payment can be claimed back from him/her.

19. The banker has no objection in making payment of ante-dated cheque.

Ans: True

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Also Read:
1. HS 12 Banking Chapter wise Notes

2. AHSEC Class 12 Banking Question Papers From 2012 Till Date

3. AHSEC Class 12 Banking Solved Question Papers From 2012 Till Date

4. Banking Chapter wise MCQs

5. Class 12 Banking Important Questions and Question Bank

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20. The paying banker refuses to honour the cheque in the following circumstances:

a) Death of the drawer

b) Insolvency or insanity of the drawer

c) Breach of trust

d) Insufficient balance

e) Signature mismatch

f) Cheque presented after banking hours