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WAEC Commerce 1995 Question 73

Question 73

Banking

A cheque is cleared

  1. A.when it has been accepted by the drawer
  2. B.when the amount specified has been credited to the payee
  3. C.when it is deposited
  4. D.if the alterations are signed
  5. E.when it has been taken away for safe keeping
Show the answer and explanation

Answer: B (when the amount specified has been credited to the payee)

Explanation

A cheque is cleared when the money has passed from the drawer's account to the payee's account.