To Be Safe in Writing a Direct Reply Letter on Company

question 33

Multiple Choice

To be safe in writing a direct reply letter on company stationery, you should

• A) wait at least ten business days to allow any problem to subside.
• B) develop a plan to reduce the benefits offered for any claim resolution.
• C) gather facts, check figures, and receive any needed approvals.
• D) have your legal staff check every letter before you send it.

Identify the difference between transfer warranties and presentment warranties.

Be aware of the specific rules and rationale behind the impostor rule and fictitious payee rule.

Comprehend the effect of breaches of warranties and how they relate to liabilities and recoveries.

Understand the defenses available against claims of conversion and the criteria for being a holder in due course.

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Definitions:

Decentralized Operations

A business structure where decision-making is distributed among various levels or locations rather than concentrated at a single point.

Responsibility Accounting

A system of accounting that collects, summarizes, and reports financial information relating to the responsibilities of individual managers.

Controllable Costs

Costs that a manager or company has the power to influence or change directly.

Manufacturing Overhead Costs

These are indirect costs related to manufacturing that cannot be directly traced to specific units produced, such as utilities, depreciation, and factory equipment maintenance.