On the back of a check "payable to Huan," Huan signs her name and negotiates the item to Ito. To avoid liability on the item if it is later dishonored, Ito should
A)immediately indorse the check in blank.
B)make a copy of the check and place it in a secure location.
C)write, above Huan's signature, "Pay to Ito."
D)indorse the check "without recourse."

Question

Quizplus · Accepted Answer

Indorsing the check "without recourse" is a way for Ito to avoid liability if the check is dishonored. This type of endorsement means that Ito does not guarantee payment of the check to subsequent holders.

On the Back of a Check "Payable to Huan," Huan