Which of the Following Statements Is True Regarding a Surety

question 63

Multiple Choice

Which of the following statements is true regarding a surety?

• A) The creditor must first try to collect from the debtor before the surety becomes obligated on the debt.
• B) A surety usually does not become a part of the original agreement between the debtor and the creditor.
• C) A surety is obligated to pay the debt as soon as it becomes due.
• D) A surety usually enters into a separate contract with the surety who binds him to the first contract between the debtor and the creditor.

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Definitions:

Historical Cost

The initial cost of an asset or investment when it was first purchased.

Patents

Legal documents granting exclusive rights to inventors for their innovations, preventing others from making, using, or selling the invention for a certain period of time.

Accounts Receivable

Money that is owed to a company by its customers for goods or services that have been delivered but not yet paid for.