Simon Sharpe executed and delivered to Ben Bates a negotiable promissory note payable to the order of Ben Bates for $500. Bates indorsed the note “Pay to Carl Cady upon his satisfactorily repairing the roof of my house, (signed) Ben Bates” and delivered it to Cady as a down payment on the contract price of the roofing job. Cady then indorsed the note and sold it to Timothy Tate for $450. What rights, if any, does Tate acquire in the promissory note?

Simon Sharpe executed and delivered to Ben Bates a negotiable promissory note payable to the order of Ben Bates for $500. Bates indorsed the note “Pay to Carl Cady upon his satisfactorily repairing the roof of my house, (signed) Ben Bates” and delivered it to Cady as a down payment on the contract price of the roofing job. Cady then indorsed the note and sold it to Timothy Tate for $450. What rights, if any, does Tate acquire in the promissory note?

Business Its Legal Ethical & Global Environment

10th Edition

ISBN:9781305224414

Author:JENNINGS

Publisher:JENNINGS

Chapter12: Contracts And Sales:introduction And Formation

Section: Chapter Questions

Problem 10QAP

See similar textbooks

Similar questions

On July 24 of the current year, Sam Smith was involved in an accident with his business use automobile. Sam had purchased the car for 30,000. The automobile had a fair market value of 20,000 before the accident and 8,000 immediately after the accident. Sam has taken 20,000 of depreciation on the car. The car is insured for the fair market value of any loss. Because of Sams history, he is afraid that if he submits a claim, his policy will be canceled. Therefore, he is considering not filing a claim. Sam believes that the tax loss deduction will help mitigate the loss of the insurance reimbursement. Sams current marginal tax rate is 35%. Write a letter to Sam that contains your advice with respect to the tax and cash flow consequences of filing versus not filing a claim for the insurance reimbursement for the damage to his car. Also prepare a memo for the tax files. Sams address is 450 Colonels Way, Warrensburg, MO 64093.
Hassad owns a rental house on Lake Tahoe. He uses a real estate firm to screen prospective renters, but he makes the final decision on all rentals. He also is responsible for setting the weekly rental price of the house. During the current year, the house rents for 1,500 per week. Hassad pays a commission of 150 and a cleaning fee of 75 for each week the property is rented. During the current year, he incurs the following additional expenses related to the property: a. What is the proper tax treatment if Hassad rents the house for only 1 week (7 days) and uses it 50 days for personal purposes? b. What is the proper tax treatment if Hassad rents the house for 8 weeks (56 days) and uses it 44 days for personal purposes? c. What is the proper tax treatment if Hassad rents the house for 25 weeks (175 days) and uses it 15 days for personal purposes?
Before starting to render his service, Paolo collected an advance payment of P2,000 for the acceptance of the job contract. When the required service from Paolo was completed, Paolo received P8,000 cash service fee after deducting the P2,000 advance payment, plus an office machine with cash price value of P3,000 and P2,500 cost to the seller. The gross service income of Paolo is
Myrta entered into a contract with "Big Builder on December 1, 2018 to remodel the interior of her Coffee Shop. The Contract required Big Builder to complete the project ata cost of $10,000 on or before January 1, 2019 (so she could open herCoffee Shop that day). Big Builder barely got started on the project by January 1, so Myrta terminated the Contract without paying Big Builder anything. Myrta then found a new Contractor, named "Better Builder who agreed to complete the same project by March 1, 2019 but at a cost of $11,500. Better Builder completed the project on March 1, 2019 and Myrta paid them $11,500. Happy the project is finally complete, Myrta still feels "ripped off by Big Builder and wants to sue them to recover her damages for breach of contract. Not only did Myrta have to pay $11,500 to Better Builder, but (i) she also had to pay a cleaning service $200 to clean up the construction mess Big Builder had left behind and (ii) she also lost an estimated $500 in profits she…
In January, Prahbu purchased for $100,000 a new machine for use in an existing production line of his manufacturing business. Assume that the machine is a unit of property and is not a material or supply. Prahbu pays $4,075 to install the machine, and after the machine is installed, he pays $2,350 to perform a critical test on the machine to ensure that it will operate in accordance with quality standards. On November 1, the critical test is complete, and Prahbu places the machine in service on the production line. On December 3, Prahbu pays another $5,400 to perform periodic quality control testing after the machine is placed in service. How much will Prahbu be required to capitalize as the cost of the machine?
Dean and Donna Testa hired a home inspector before they purchase a $250,000 home. The inspector charged $400. The original contract for his services contained a clause titled, "Consequential Damages." The clause was drafted by the Testa's and stated that if the inspection failed to identify flaws which resulted in expensive repairs, the inspector would pay for the repairs. The inspector's final report stated that the home's septic system had all 4 required parts. A reasonably competent inspector would have discovered that the system did not have all 4 parts. Each of the 4 part costs $10,000. After the purchase, the Testa's discover that 2 of the 4 parts of the septic system are missing. The Testa's sue the inspector. Group of answer choices The Testa's damages are limited to the value of the contract, $400. The Testa's may recover punitive damages for fraud. The Testa's may recover $20,000 The Testa's may recover $40,000.
Holt Industries received a $2,000 prepayment from the Ramirez Company for the sale of new office furniture.Holt will bill Ramirez an additional $3,000 upon delivery of the furniture to Ramirez. Upon receipt of the $2,000prepayment, how much should Holt recognize for a contract asset, a contract liability, and accounts receivable?
In janaruary, Prahbu purchased a new machine for use in the existing production line of his manufacturing business for $90,000. Assume that the machine is a unit of property and is not a material or supply. Prahbu pays $2,500 to install the machine, and after the machine is installed, he pays $1,300 to perform a critical test on the machine to ensure that it will operate in accordance with quality standards. On November 1, the critical test is complete and prahbu places the machine in service on the production line. On December 3, prahbu pays another $3,300 to perform periodic qaulity testing after the machine is placed in service. . How much will prahbu be required to capitalize as the cost of the machine.?
Peyton sells an office building and the associated land on May 1 of the current year. Under the terms of the sales contract, Peyton is to receive $2,679,000 in cash. The purchaser is to assume Peyton's mortgage of $1,607,400 on the property. To enable the purchaser to obtain adequate financing, Peyton is to pay the $32,148 in points charged by the lender. The broker's commission on the sale is $107,160. What is Peyton's amount realized? The amount realized by Peyton is $_________