Which of the Following Statements Is True of a Restrictive

question 44

Multiple Choice

Which of the following statements is true of a restrictive indorsement?

• A) A person who purchases a check indorsed "for collection" automatically converts it even if the indorser received the amount paid for it.
• B) If an indorser merely signs his name and does not specify to whom the instrument is payable, he has indorsed the instrument in restriction.
• C) A person who takes an instrument with a restrictive indorsement should not pay for the instrument consistently with the indorsement.
• D) It includes indorsements for collection, which are commonly put on by banks involved in the collection process, and indorsements for deposit.

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