What Is the Effect of Marking a Cheque 'Not Negotiable

question 49

Multiple Choice

What is the effect of marking a cheque 'not negotiable'?

• A)The payment figure on the cheque cannot be altered.
• B)The cheque must be paid into a bank account
• C)A transferee cannot obtain better title than the transferor.
• D)The cheque becomes non-transferable.

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Definitions:

Contingent Liability

A potential obligation that may arise depending on the outcome of a future event.

Recorded

The act of entering financial transactions into the accounting records of a business.

Interest-Bearing Note

A financial instrument that requires the issuer to pay interest in addition to repaying the principal amount at the note's maturity.

Maturity

The date on which a financial obligation, such as a bond or loan, is due to be fully paid off.