CDCS e-Quiz

1. A credit requires an 'invoice' without further definition. Which of the following MUST be considered a discrepancy?

An invoice:

A. which is not signed.
B. identified as a tax invoice.
C. made out in a different currency to the credit.
D. issued for an amount in excess of that permitted by the credit.

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2. A documentary credit is issued for GBP 60,000 and calls for drafts at 30 days from bill of lading date. Documents have been presented with a bill of lading dated 09 November. Which of the following tenors on the draft will NOT be acceptable?

A. 09 December.
B. 30 days after 09 November.
C. 30 days from bill of lading date.
D. 30 days date, draft dated 09 November.

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3. A documentary credit prohibits partial shipment. A presentation is made containing two sets of original charter party bills of lading covering shipment from two different ports of loading within a geographical area stated in the credit. To be complying, the bills of lading must indicate:

1. shipment to the same port of discharge.
2. same date of shipment.
3. shipment on the same vessel.
4. same journey.

A. 1 and 4 only.
B. 2 and 3 only.
C. 1, 2 and 3 only.
D. 1, 3 and 4 only.

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4. Which of the following payment terms are possible under a credit available with, and requiring a draft drawn on, an issuing bank?

1. Payment.
2. Deferred payment.
3. Acceptance.
4. Negotiation.

A. 1 and 2 only.
B. 1 and 3 only.
C. 2 and 3 only.
D. 3 and 4 only.

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5. A cumulative revolving documentary credit is opened with six months' validity and allowing for USD 25,000 to be drawn each month. A single drawing is made for USD 25,000 in the first month. What is the available amount in the fourth month?

A. USD 25,000.
B. USD 75,000.
C. USD 100,000.
D. USD 125,000.

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6. Which of the following statements is correct under a common syndicate agreement?

A. Amendments to the documentary credit will only bind the lead bank.
B. The documentary credit must stipulate the risk participation of each syndicate bank.
C. The value of the documentary credit, the goods, the validity for shipment and expiry should be covered.
D. Each participating bank draws up a syndicate agreement and each of these agreements is countersigned by the lead bank.

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