Which of the following is an example of a dishonor?
A)Dan forgets to make presentment of a check but demands money from Ben.
B)Dan issues a check to Ben, who takes it to the bank after six months and the bank declines.
C)Dan issues a check to Ben but it is returned by the bank due to insufficient funds.
D)Dan demands payment of a note from Ben before the due date and Ben declines.

Question

Quizplus · Accepted Answer

Dishonor occurs when a negotiable instrument, such as a check, is presented for payment but is refused or cannot be paid. Option C, where Dan's check is returned by the bank due to insufficient funds, is a classic example of dishonor.

Which of the Following Is an Example of a Dishonor