9) Lou wants to borrow money to buy a vintage Stradivarius violin. He goes to hi

Question

9) Lou wants to borrow money to buy a vintage Stradivarius violin. He goes to his but the loan officer tells him that musicians are notoriously atrocious credit risks, stable to Nathan, a writes "as nowhere to be demanding payment. If and that Lou cannot get a loan unless he gets someone more financially sign a promissory note along with him. Lou then gets his brother-in-law CPA, to sign the note along with Lou. When Nathan signs, he also surety". Lou then gets his loan. When the note comes due, Lou its found. The loan officer then shows up at Nathan's door, Nathan is found liable, it is because: a: Nathan must pay on the spot because he is an accommodation party b: Nathan must pay on the spot because he has primary liability c: Nathan need not pay unless and until Lou fails to pay. d: Nathan need not pay unless he cannot prove that he signed as Lou's agent. 10) Under the Sarbanes-Oxley Act, which of the following individuals are required personally to certify to the accuracy of financial statements filed with the SEC a: The chief financial officer and the chief executive officer b: The chief financial officer, the chief executive officer, and the controller. c: The audit partner and the chief executive officer. d: The chairman of the board, the chief executive officer, and the chief financial officer. 11) The right that refers to a surety's ability to sue a debtor after paying off a loan is: bx Reciesioo c: Reimbursement d: Subrogation 12) In a bankruptcy proceeding, a(n) provides for the full or partial elimination of a debtors debts. a: extension b: discharge c: composition d: itemization 13) A party who is a guarantor a: Has secondary liability b: Has primary liability. c: Has the same liability as a guarantor of collection. d: Has liability as long as there are enough assets to pay the debt obligation. 14) Which of the following allows a guarantor to assume the rights of the creditor to pursue to principal debtor? a: Attachment b: Execution c: Subrogation d: Contribution

Explanation / Answer

Ans 9. The co-signer has the same level of liability as the borrower.

Option C. Nathan need not pay unless and until Lou fails to pay. He is liable to pay in case Lou defaults.

Ans 10. “Under the SECTION 302 of the Sarbanes-Oxley Act, the SEC rules require each CEO and CFO to certify in each annual and quarterly report including transition report.”

Option A. The chief financial officer and the chief executive officer.

Ans 11. The right that refers to a surety’s ability to sue a debtor after paying off a loan is:

Option D. Subrogation: “It is the normal recovery of damages from a third party after stepping into the shoes of the borrower. “

Ans 12. In a bankruptcy proceeding a ….. provides for the full or partial elimination of the debtor’s debts.

Option B: Discharge: which releases the debtors from personal liability from specific debts and prohibits the creditors from taking any legal action against them?

Ans 13. A party who is a guarantor:

Option B: has primary liability

Ans 14. Which of the following allows a guarantor to assume the rights of the creditor to pursue the principal debtor?

Option D: Contribution “is right of a person who has discharged a common liability or to recover a burden to cover proportionate share from another.”

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