Ismail Used a Cheque to Pay for a Widget That

question 59

Multiple Choice

Ismail used a cheque to pay for a widget that he bought from Maria.Maria delivered the cheque to Geoff Gagne after writing her signature and the following words on the back of it: "To Geoff Gagne if he builds a gazebo in my backyard." After he acquired the cheque,Geoff wrote his signature and the following words on the back of it: "For deposit only." Which of the following statements is TRUE?

• A)The cheque contains a qualified endorsement and a restrictive endorsement.
• B)The cheque contains a qualified endorsement and a special endorsement.
• C)Geoff can negotiate the cheque to Fawn by simply delivering it to her.
• D)Geoff can require Ismail to add an accommodation endorsement to the cheque.
• E)The cheque contains a conditional endorsement and a restrictive endorsement.

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Definitions:

Direct Method

A way of preparing the cash flow statement where actual cash flow information from the company's operations is used, instead of being derived from the income statement.

Cost of Goods Sold

The expenses directly tied to the manufacturing of the products a company sells, including labor and materials.

Accounts Payable

Represents the amount a company owes to its suppliers or creditors for goods and services received but not yet paid for.

Operating Activities

The day-to-day actions a company takes through its production, sales of goods, or provision of services, as reflected in its cash flow.