1. Long made a check out to Cindy for $40. Cindy fraudulently changed the check to read $400 and she cashed it at Bank of America. Is Long discharged from liability on the check?

	a.	Yes, Long owes nothing on the check because alteration of a check is a real defense and real defenses are good even against a holder in due course.
	b.	Yes, Long owes nothing unless Bank of America is a holder in due course in which case he owes the original $40.
	c.	No, Long owes $400 because he is not an indorser or accommodation party.
	d.	No, Long owes $400 because of the imposter rule.

2. Frank is the comptroller of ABB, Inc. and he is responsible for payroll. In order to make a little extra money, Frank adds employees named "Sam Johnson" and "Bill Jones" to the payroll, names he made up. However, he issues paychecks to "Sam Johnson" and "Bill Jones", he then endorses the checks in those names and deposits the funds into his own account. His bank is not aware that "Sam Johnson" and "Bill Jones" do not exist. Sam and Bill are:

	a.	imposters
	b.	employee indorsers
	c.	fictitious payees
	d.	liable on the instruments