A Person Who Becomes a Party to an Instrument to Add

question 27

Multiple Choice

A person who becomes a party to an instrument to add strength to the instrument for the benefit of another party to the instrument is called a:

• A) benefactor.
• B) secondary obligor.
• C) collateral obligor.
• D) contingent beneficiary.

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Definitions:

Trial Balance

A ledger summary sheet where the sums of all accounts are organized into equal columns for both debits and credits.

Error

A mistake in recording financial data, which can be due to miscalculation, oversight, or misunderstanding of accounting principles.

Ledger

A book or other collection of financial accounts of a particular type or for a specific purpose in accounting.

Journal

A formal record where all financial transactions of a business are initially recorded, date-wise, before being posted to the general ledger.