Part 1:

The PI owners are still confused about the meaning of, and possible liabilities related to, negotiable instruments.Gale and Pat ask you to prepare material to clarify the owners' questions and concerns.

Instructions:

First, review the requirements necessary for a check to be a negotiable instrument.Analyze and summarize information and prepare responses to Parts I and II below to discuss with the PI owners.

1.Analyze, list, and explain the primary potential risks associated with PI's dealing with negotiable instruments and why.

2.Analyze and write an explanation to the question for the following hypothetical scenario.

Scenario A:As part of PI's community involvement, the company has become the title sponsor for a local charity golf tournament. After the tournament and during the awards luncheon, PI will be presenting the charity beneficiary with a check for the proceeds from the day's activities. They want to present the check on an 18 in x 24 in cardboard.

Can this 18 in x 24 in cardboard check be a negotiable instrument? Why or why not?

• Refer to all the requirements for negotiability in the explanation.