When a Specific Payee Is Named in an Instrument,the Instrument

question 64

Multiple Choice

When a specific payee is named in an instrument,the instrument is known as a[n] _____ instrument.

• A) Demand
• B) Order
• C) Transactional
• D) Bearer
• E) Payor

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Definitions:

Fair Value

The selling price of an asset or the price to take on a liability in a coordinated market transaction at the time of measurement.

Intra-Entity Gains

Profits resulting from transactions within the same entity or between entities under common control, which are not realized in the consolidated financial statements until sold to an external party.

Initial Value Method

An accounting approach where investments are recorded at their cost at the time of acquisition without adjustment for market changes.

Noncontrolling Interest

The portion of equity in a subsidiary not owned by the parent company, reflecting the equity interest of minority shareholders.