If a Negotiable Instrument Is Payable on Demand, It Is

question 30

Multiple Choice

If a negotiable instrument is payable on demand, it is overdue:

• A) the day after demand for payment has been made in a proper manner and form.
• B) 30 days after its date if it is a check.
• C) 3 days after demand for payment has been made in a proper manner and form.
• D) 60 days after its date if it is a check.

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Definitions:

Cash Dividends

Payments made by a corporation to its shareholders, usually in the form of cash, as a distribution of the company’s earnings.

Direct Method

A technique used in accounting to prepare the cash flow statement, where actual cash flows from operating activities are reported instead of adjustments to net income.

Operating Activities

Activities that constitute the primary or main activities of an entity, such as selling goods and services, which are reflected in the statement of cash flows.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within the year or within the operating cycle of the business, whichever is longer.