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A company which issues a promissory note in lieu of payment for goods purchased

A company which issues a promissory note in lieu of payment for goods purchased
Take Free Practice Test On 2026 JAMB UTME, Post UTME, WAEC SSCE, GCE, NECO SSCE
  • A Is not bound to renew the note before payment
  • B Can return the goods purchased and refuse to pay
  • C Can refuse to pay on due date since it is only a promise
  • D Is bound to redeem the note for cash on due date
Correct Answer: Option D
Explanation:
A promissory note is a financial instrument that contains a written promise by one party to pay another party a definite sum of money.
the company is bound to redeem the cash on the due date

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