Cici signs a check "pay to the order of Doug" drawn on Cici's account in Eastside Bank.Cici shows the check to Frederica,who agrees that the signature is Cici's and that Doug is owed the amount that the check represents.Doug signs the back of the check.Liability on this check extends to
A) Cici, Doug, and Eastside Bank.
B) Cici and Doug only.
C) Cici and Frederica only.
D) Frederica only.

Question

Cici signs a check "pay to the order of Doug" drawn on Cici's account in Eastside Bank.Cici shows the check to Frederica,who agrees that the signature is Cici's and that Doug is owed the amount that the check represents.Doug signs the back of the check.Liability on this check extends to​ 
A) ​Cici, Doug, and Eastside Bank. 
B) ​Cici and Doug only. 
C) ​Cici and Frederica only. 
D) ​Frederica only.

Quizplus · Accepted Answer

Once Doug endorses the check by signing the back, he becomes the legal owner of the check and can deposit or cash it. The liability for the check, however, remains with Cici, the account holder, and Doug, the payee who endorsed it. Frederica, who only verified the signature and the amount owed, does not assume any liability for the check. Eastside Bank is not liable either since they only provide the banking services and do not endorse the check or participate in the transaction beyond processing it.

Cici Signs a Check "Pay to the Order of Doug