Jack Signs an Instrument That States It Is Being Executed

question 24

Multiple Choice

Jack signs an instrument that states it is being executed "as per a contract for the sale of three magic beans dated June 1." This instru?ment is

• A)negotiable.
• B)nonnegotiable,because banks cannot easily process commodities.
• C)nonnegotiable,because it includes the specific date of a contract.
• D)nonnegotiable,because it refers to an express contract.

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Definitions:

LIFO

An inventory valuation method that assumes the last items placed in inventory are the first ones sold ("Last In, First Out").

Merchandise sold cost

The cost associated with the goods that have been sold to customers, typically accounting for the purchase or production cost of the merchandise.

Perpetual inventory system

A method of accounting that continuously updates the inventory balance, recording each purchase and sale of goods immediately through inventory accounts.

FIFO inventory cost method

An inventory valuation method where the cost of goods sold is based on the cost of the earliest purchased items, standing for "First In, First Out".