Fact Pattern 27-1 Chuck Is the Maker of a $200,000 Promissory Note Payable

question 13

Multiple Choice

Fact Pattern 27-1
Chuck is the maker of a $200,000 promissory note payable to Investors Corporation. Investors indorses the note to Equity Lenders, which in turn indorses it to Select Holdings LLC, which then indorses it to Global Bank, the present holder.
-Refer to Fact Pattern 27-1. Suppose that Select Holdings pays Global Bank on the note. With timely notice to the proper parties, Select Holdings may then collect payment on the note from​

• A) ​Chuck, Investors, or Equity Lenders.
• B) ​Chuck or Investors only.
• C) ​Equity Lenders only.
• D) ​no one.

---

Definitions:

Net Present Value

A method used in capital budgeting to assess the profitability of an investment, calculating the difference between the present value of cash inflows and outflows.

Additional Working Capital

Refers to the extra funds a business requires for its day-to-day operations, beyond its current operational needs.

Salvage Value

The anticipated end-of-service-life residual value of an asset.

Discount Rate

The interest rate used in discounted cash flow analysis to determine the present value of future cash flows, reflecting the investment's risk and the time value of money.