Jen signs a check "pay to the order of Key" drawn on Jen's account in Little Bank to buy Key's car. Jen asks Little Bank to indicate on the face of the check that it will accept it when Key presents it for payment. If the bank agrees, this will be
A) a cashier's check.
B) a certified check.
C) a trade acceptance.
D) a traveler's check.

Question

Quizplus · Accepted Answer

When Little Bank agrees to indicate on the face of the check that it will accept it when Key presents it for payment, it becomes a certified check. A cashier's check is issued by a bank, not a customer, and is drawn on the bank's account. A trade acceptance is used in commercial transactions between buyers and sellers. A traveler's check is a specialized form of a check used for travel purposes.

Jen Signs a Check "Pay to the Order of Key