Asked by Kawinthida Kanajoth on May 29, 2024
Verified
Juice Company signs an instrument that states it is being executed "as per a contract for the sale of a case of oranges dated May 1." This instrument 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.
Express Contract
A clearly stated agreement between parties, with terms explicitly mentioned either orally or in writing.
Commodities
Commodities are raw materials or agricultural products that can be bought and sold, such as gold, oil, or grains.
Nonnegotiable
Unable to be bought, sold, exchanged, or transferred to another party.
- Acquire knowledge on the effect of terms and conditions on an instrument's ability to be negotiated.
Verified Answer
HM
Hashir MasoodJun 03, 2024
Final Answer :
A
Explanation :
The instrument is negotiable because the reference to a contract does not affect its negotiability. Negotiability is concerned with the instrument's terms being fixed and unconditional, not whether it mentions or is related to another contract.
Learning Objectives
- Acquire knowledge on the effect of terms and conditions on an instrument's ability to be negotiated.