Ch 16 - Notes Payable and Receivable GENERAL Flashcards
1
Q
What are the five UCC requirements for an instrument to be negotiable?
A
- be in writing and signed by maker or drawer
- contain unconditional promise/order to pay definite amount of money
- payable either on demand or at future time that is fixed or can be determined
- payable to order of specific person or bearer
- clearly name or identify the drawee if addressed to a drawee
2
Q
Which has more legal protection: accounts payable or note payable?
A
notes payable
3
Q
What is the formula for calculating interest on a note?
A
Interest = Principal x Rate x Time
4
Q
What is the formula for maturity value of a note?
A
maturity value = principal plus interest
5
Q
How do you find the maturity date of a note?
A
number of days from date of issue until it is due, not including the first day
