Edie Fraudulently Induces Franco, a Consumer, to Sign a Promissory

question 72

Multiple Choice

Edie fraudulently induces Franco, a consumer, to sign a promissory note to buy a speedboat. Edie sells the note to Gus, who takes it for value, in good faith, and without knowledge of the fraud. With respect to the defense against payment on the note to Edie, Franco can​

• A) ​assert this defense against Gus.
• B) ​file for a property exemption.
• C) ​exercise the right of subrogation.
• D) ​obtain a deficiency judgment.

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Definitions:

Direct Method

A costing approach that allocates service department costs directly to producing departments without considering service department interactions.

Support Department

A division within an organization that provides essential services to other departments but does not directly contribute to profit, such as IT or HR.

Cost Allocation

The process of distributing or assigning indirect costs to different departments, products, or projects.

Reciprocal Method

An approach in cost accounting used to allocate service department costs to production departments, considering the mutual services exchanged between service departments.