Which of the Following Is True About the Requirement for a Holder

question 33

Multiple Choice

Which of the following is true about the requirement for a holder in due course to give value for an instrument?

• A) It can be met in any way that the consideration requirement can be met in an ordinary contract.
• B) It can be met only if the holder has paid cash for the instrument.
• C) In order to meet the requirement to give value,the value given must be comparable to the value of the instrument received.
• D) Acceptance of the instrument in settlement of a preexisting claim meets the value requirement.
• E) An unperformed promise meets the value-given requirement so long as the promise is performed prior to the actual collection of any amount on the instrument.

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Definitions:

Overtime Wages

Additional pay granted to employees for hours worked beyond their standard scheduled hours.

Expensed

Recorded as an expense in the financial statements in the period in which it is incurred.

Statement

A formal record or document detailing financial activities or conditions, such as an income statement or balance sheet.

Adjusting Entries

Journal entries made at the end of an accounting period to update accounts for accuracies in preparation for financial statement generation.