Question

Doug takes a $500 check drawn by Gail to Gail's drawee bank to cash it. Gail has over $10,000 on deposit in her account, but her bank refuses to pay Doug. This situation could be due to which of the following reasons?

A) Insufficient funds in Gail's account.
B) The check was post-dated.
C) The signature on the check was missing.
D) The check was not properly endorsed by Gail.

Answer 1

The bank may have refused to pay Doug the $500 check because the check was not properly endorsed by Gail.

Step-by-step explanation:

The reason why Gail's bank refused to pay Doug the $500 check could be because the check was not properly endorsed by Gail. Endorsing a check means signing the back of the check, indicating that the check is being transferred to someone else or being deposited into their account. Without Gail's endorsement, the bank would not release the funds to Doug.