Jess Receives a Check from Kelly

question 72

Multiple Choice

Jess receives a check from Kelly. Without Jess's knowledge, Leo indorses it in his own name and deposits it in his account at Metro Bank. In Jess's subsequent suit against the bank for the money, the court will most likely rule in favor of​

• A) ​Jess, because Leo's signature is not authorized.
• B) ​Jess, because Metro Bank is not a holder in due course.
• C) ​Metro Bank, because Leo's signature is not authorized.
• D) ​Metro Bank, because it is a holder in due course.

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Definitions:

Inventory Turnover

A metric that measures the efficiency of a company in managing its stock of goods through the calculation of the cost of goods sold divided by average inventory.

Accounts Receivable Period

The average number of days it takes for a company to collect payment from its credit sales.

Cash Cycle

The period between the outlay of cash for raw materials and receiving payment from customers for goods or services sold.

Inventory Period

The average time it takes for a company to sell through its inventory, calculated by dividing the total inventory by the cost of goods sold and then multiplying by 365 days.