Which of the Following Statements Is True of Primary Liability

question 7

Multiple Choice

Which of the following statements is true of primary liability on a check when it is issued?

• A) The payee is primarily liable on it.
• B) The drawer is primarily liable on it.
• C) The drawee bank is primarily liable on it.
• D) No party is primarily liable on it.

---

Definitions:

Inventory

The raw materials, work-in-process products, and finished goods that a company holds for the purpose of sale in the near future.

Net Loss

A situation where total expenses exceed total revenues during a specific period, resulting in negative profit.

Net Cash Flow

The difference between a company's cash inflows and outflows within a specific period.

Operating Activities

Transactions related to the core business operations of a company, including revenue-generating activities and expenses necessary for generating revenue.