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Paul University Philippines

Tuguegarao City
FINALS 1st Semester SY 2016-2017
NAME: ____________________________
COURSE & YEAR: __________________
_______________1. A bill of exchange is an unconditional promise in writing.

_______________2. A promissory note has 3 parties.

_______________3. In general, all parties whose signature appears on an
instrument are liable.
_______________4. A negotiable bill of exchange is always payable to order.
_______________5. An undated instrument is not negotiable.
_______________6. The drawee may refuse acceptance of an instrument.
_______________7. The maker of a promissory note is the person primarily
liable on the instrument.
_______________8. Indorsement of an instrument must always be made on
the face of the instrument itself.
_______________9. An instrument can be dishonored by non-acceptance.
_______________10. The payee of an instrument must always be a specific
_______________11. An indorsement must not be subject to any condition.
_______________12. A restrictive indorsement prohibits further negotiation of
an instrument.
_______________13. The holder must give notice of dishonor to all parties to
the instrument.
_______________14. An inland bill of exchange is payable anywhere.
_______________15. Where an instrument payable on demand is negotiated
for an unreasonable length of time after its issue, the
holder is not deemed a holder in due course
_______________16. The holder of an instrument is authorized to insert his
name in a blank indorsement.
_______________17. Every holder of an instrument is deemed a holder in due
_______________18. A holder of an instrument is allowed to strike any
_______________19. Notice of dishonor is always in writing.
_______________20. When an instrument is NOT payable on demand,
presentment must be made on the day it falls due.
_______________21. Where an instrument is payable at a bank, presentment
for payment must be made during banking hours.

_______________22. An agent is not authorized to receive notice of dishonor.

_______________23. An overdue instrument can no longer be paid.
_______________24. A negotiable instrument is discharged by payment in due
_______________25. Intentional cancellation of the holder of an instrument
discharges the instrument.

TEST II. Prepare the appropriate negotiable instrument for the following

1. Maria Casibang purchased medical supplies on credit for P500,000.00

from Alyola Pharmaceuticals, Inc,. As payment, it was agreed that a
negotiable instrument shall be drawn against Bank of Sultan Kudarat.

2. On September 30, 2016, Mr. Gorio Lingan obtained a loan from Mr.
Kuset Zinampan amounting to P100,000.00 payable by the end of the
year. In exchange, the debtor issued to the creditor a negotiable

3. Ifan Adducul purchased a motorcycle from Honda, Balzain,

Tuguegarao City on installment for one year. Being the account
executive of Honda, Balzain, prepare a negotiable instrument for the
payment of the motorcycle amounting to P85,000.00

4. Daling Pazziuagan engaged the services of Evas Panciteria as

caterer for her daughters debut on November 1, 2016. Daling
issued a negotiable instrument as payment amounting to P25,000.00