Assuming No Exception Applies, Which of the Following Is True

question 8

Multiple Choice

Assuming no exception applies, which of the following is true regarding the effect of a debtor offering to pay less money than is owed as full payment on a debt for which there is a dispute over the amount of the debt, and the creditor agrees?

• A) A liquidated debt is involved, and there is an accord and satisfaction.
• B) A liquidated debt is involved, and there is an accord but no satisfaction.
• C) A liquidated debt is involved, and there is neither a satisfaction nor an accord.
• D) An unliquidated debt is involved, and there is an accord and satisfaction.
• E) An unliquidated debt is involved, and there is an accord but not satisfaction.

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Definitions:

Unsecured Bonds

Bonds issued without collateral, relying on the issuer's creditworthiness for support.

Term Bonds

Bonds that have a set maturity date on which the principal amount will be repaid to bondholders.

Bond Indenture

A bond indenture is a legal contract specifying the terms and conditions under which a bond is issued, including interest rate, maturity date, and issuer obligations.

Trade Accounts Payable

Liabilities owed by a business to its suppliers or creditors for inventory or services received that are yet to be paid for.