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Question: Laboratory Management deposited into its account at


Laboratory Management deposited into its account at Pulaski Bank a check issued by Fairway Farms in the amount of $150,000. The date of deposit was February 5. Pulaski, the depositary bank, initiated the collection process immediately by forwarding the check to Worthen Bank on the sixth. Worthen sent the check on for collection to M Bank Dallas, and M Bank Dallas, still on February 6, delivered the check to M Bank Fort Worth. That same day, M Bank Fort Worth delivered the check to the Fort Worth Clearinghouse. Because TAB/West Side, the drawee/payor bank, was not a clearinghouse member, it had to rely on TAB/Fort Worth for further transmittal of the check. TASI, a processing center used by both TAB/Forth Worth and TAB/West Side, received the check on the sixth and processed it as a reject item because of insufficient funds. On the seventh, TAB/West Side determined to return the check unpaid. TASI gave M Bank Dallas telephone notice of the return on Febru- ary 7 but physically misrouted the check. Because of this, M Bank Dallas did not physically receive the check until February 19. However, M Bank notified Worthen by tele- phone on the fifteenth of the dishonor and return of the check. Worthen received the check on the twenty-first and notified Pulaski by telephone on the twenty-second. Pulaski actually received the check from Worthen on the twenty-third. On February 22 and 23, Laboratory Management’s checking account with Pulaski was $46,000. Pulaski did not freeze the account because it considered the return to be too late. The Laboratory Management account was finally frozen on April 30, when it had a balance of $1,400. Pulaski brings this suit against TAB/ Fort Worth, TAB/Dallas, and TASI alleging their notice of dishonor was not timely relayed to Pulaski. Explain whether Pulaski is correct in its assertion.


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> What amount would a person with actual cash value (ACV) coverage receive for two-year-old furniture destroyed by a fire? The furniture would cost $2,000 to replace today and had an estimated life of five years. (LO8.2)

> Most home insurance policies cover jewelry for $2,000 and silverware for $5,000 unless items are covered with additional insurance. If $9,000 worth of jewelry and $12,000 worth of silverware were stolen from a family, what amount of the claim would not b

> What was the gift tax in 2019?

> You have $100,000 in your retirement fund that is earning 5.5 percent per year, compounded quarterly. How many dollars in withdrawals per month would reduce this nest egg to zero in 20 years? How many dollars per month can you withdraw for as long as y

> Gene and Dixie, husband and wife (ages 35 and 32), both work. They have an adjusted gross income of $95,000 in 2020, and they are filing a joint income tax return. Both have an employer-provided retirement plan at work. What is the maximum IRA contrib

> Ruby is 25 and has a good job at a biotechnology company. She currently has $10,000 in an IRA, an important part of her retirement nest egg. She believes her IRA will grow at an annual rate of 8 percent, and she plans to leave it untouched until she reti

> Using Exhibit 14-3, calculate approximately how much money the older (age 65-74) household from Problem 4 spends on medical care. (LO 14.1)

> Calculate approximately how much money an older (age 65-74) household with an annual income of $45,000 spends on housing each year. (Hint: Use Exhibit 14-3) (LO 14.1)

> Ted Riley owns a Lexus worth $40,000. He owns a home worth $275,000. He has a checking account with $800 in it and a savings account with $1,900 in it. He has a mutual fund worth $110,000. His personal assets are worth $90,000. He still owes $25,000 on h

> Prepare your net worth statement using the assets - liabilities = net worth equation. (LO 14.1)

> Currently, the economy is beginning to slowdown and there is talk that there may be a recession in the near future. Referring to Exhibit 12-3, what types of stock would you suggest for Jamie and Ross to invest in considering their life stage and current

> Joe and Rachel are both retired. Married for 55 years, they have amassed an estate worth $4.4 million. The couple has no trust or other type of tax-sheltered assets. If Joe or Rachel died in 2020, how much federal estate tax would the surviving spouse

> What is the total of estate removed from Barry and Mary's estate in 2020?

> How much money can Barry and Mary gift to their grandchildren in 2020 without any gift tax liability?

> How much money can they gift to their children in 2020 without any gift tax liability?

> In 2020, you gave a $15,000 gift to a friend. What was the gift tax in 2020? (LO 14.4)

> What will be the gift tax in 2020?

> What is the total amount removed from Joshua’s estate in 2020?

> Shelly's assets include money in checking and saving accounts, investments in stocks and mutual funds, personal property, such as furniture, appliances, an automobile, coin collection and jewelry. Shelly calculates that her total assets are $165,200. H

> Using the "nonworking" spouse method, what should be the life insurance needs for a family whose youngest child is 5 years old? (LO10.1)

> Using the "nonworking" spouse method, what should be the life insurance needs for a family whose youngest child is ten years old? (LO10.1)

> Jamie Lee’s father suggested that they purchase stock in a company that he has held shares in for decades. They want to take advantage of the stock tip, but Jamie Lee and Ross are trying to decide between purchasing the company’s common stock and prefer

> You are a dual income, no-kids family. You and your spouse have the following debts (total): mortgage, $200,000; auto loan, $10,000; credit card balance, $4,000; and other debts of $10,000. Further, you estimate that your funeral will cost $8,000. You

> Mark and Parveen are the parents of three young children. Mark is a store manager in a local supermarket. His gross salary is $75,000 per year. Parveen is a full time stay-at-home mom. Use the easy method to estimate the family's life insurance needs

> Use Exhibit 10-1 to find the average number of additional years a 25-year-old male and female are expected to live, based on the statistics gathered by the U.S. government as of 2017 (LO10.1)

> Use the Figure It Out worksheet in this chapter to calculate your own life insurance needs. (LO10.1)

> Shaan and Anita are married and have two children, ages 4 and 7. Anita is a “nonworking” spouse who devotes all of her time to household activities. Estimate how much life insurance Shaan and Anita should carry. (LO10.1)

> You and your spouse are in good health and have reasonably secure careers. Each of you makes about $55,000 annually. You own a condominium with an $120,000 mortgage, and you owe $15,000 on car loans, $5,000 on personal debts, and $4,000 on credit card

> Shelly’s variable annuity has a mortality and expense risk charge at an annual rate of 1.25 percent of account value. Her account value during the year is $50,000. What was Shelly’s mortality and expense risk charge for the year? (LO10.4)

> Sophia purchased a variable annuity contract with a $25,000 purchase payment. Surrender charges begin with 7 percent in the first year, and decline by 1 percent each year. In addition, Sophia can withdraw 10 percent of her contract value each year with

> Your variable annuity charges administrative fees at an annual rate of 0.15 percent of account value. Your average account value during the year is $200,000. What is the administrative fee for the year? (LO10.4)

> You are the wage earner in a “typical family,” with $58,000 gross annual income. Use the easy method to determine how much insurance you should carry. (LO10.1)

> What are the advantages and disadvantages of investing in a technology company’s IPO? Will they be guaranteed a large return from this investment? At this life stage would you recommend that Jamie Lee and Ross invest in an IPO? Why or why not?

> In 2007, Joelle spent $5,000 on her health care. If this amount increased by 6 percent per year, what would be the amount Joelle spent in 2017 for the same health care? (Hint: Use the Time Value of Money Table in Chapter 1 Appendix, Exhibit 1-A) (LO9.

> If Ronald selects the POS plan, what will his annual medical costs be? (LO9.2)

> What total costs will Ronald pay if he enrolls in the HMO plan? (LO9.2)

> What annual medical costs will Ronald pay using the sample medical expenses provided if he enrolled in the Blue Cross/Blue Shield plan? (LO9.2)

> Stephanie was injured in a car accident and rushed to the emergency room. She received stitches for a facial wound and treatment for a broken finger. Under Stephanie’s PPO plan, emergency room care at a network hospital is 80 percent covered after the

> Georgia, a widow, has a take-home pay of $1,200 a week. Her disability insurance coverage replaces 70 percent of her earnings after a four-week waiting period. What amount would she receive in disability benefits if an illness kept Georgia off work for

> Becky’s comprehensive major medical health insurance plan at work has a deductible of $750. The policy pays 85 percent of any amount above the deductible. While on a hiking trip, she contracted a rare bacterial disease. Her medical costs for treatment, i

> A health insurance policy pays 65 percent of physical therapy cost after a $200 deductible. In contrast, an HMO charges $15 per visit for physical therapy. How much would a person save with the HMO if he or she had 10 physical therapy sessions costing $5

> In 2012, per capita spending on health care in the United States was about $9,000. If this amount increased by 7 percent a year, what would be the amount of per capita spending for health care in 8 years? (Hint: Use the Time Value of Money Table in th

> The Tucker family has health insurance coverage that pays 80 percent of out-of-hospital expenses after a $1,000 deductible per person. If one family member has doctor and prescription medication expenses of $2,200, what amount would the insurance pay? (L

> Jamie Lee and Ross agree that by accomplishing their short goals, they can budget $7,000 a year towards their long-term investment goals. They are estimating that with the allocations recommended by their financial advisor, they will see an average of 7

> Shaan and Anita currently insure their cars with separate companies, paying $650 and $575 a year. If they insure both cars with the same company, they would save 10 percent on the annual premiums. What would be the future value of the annual savings o

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