A Transferor May Be Able to Set Aside a Negotiation

question 24

Multiple Choice

A transferor may be able to set aside a negotiation obtained by fraud or duress unless:

• A) a minor is involved.
• B) the negotiation was part of an illegal transaction.
• C) the negotiation was beyond the powers of the corporation.
• D) the instrument has been acquired in the meantime by a holder in due course who did not know of the misconduct.

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Definitions:

Services

Economic activities that provide intangible benefits or satisfactions, not resulting in the ownership of a physical product.

Cash

Liquid currency and other assets that are readily convertible into money.

Account Payable

Liabilities or money owed by a business to its creditors for goods and services purchased on credit.

Credit

An accounting entry that increases liabilities or equity or decreases an asset or expense.