Advanced Alloys, Inc., issued a check in the amount of $2,500 to Sergeant Steel Corporation.

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Advanced Alloys, Inc., issued a check in the amount of $2,500 to Sergeant Steel Corporation.

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Advanced Alloys, Inc., issued a check in the amount of $2,500 to Sergeant Steel Corporation. The check was presented for payment fourteen months later to the Chase Manhattan Bank, which made payment on the check and charged Advanced Alloys’s account. Can Advanced Alloys recover the payment made on the check? Why or why not?

Answer & Explanation (1)

Explanation
A check was written in the name of the SS firm and deposited in the bank for payment after fourteen months. A check is a pay order written by a client or account holder to his or her banker and payable to the account holder or bearer. It must be submitted by a certain date or within six months after the date of drafting. The check had been with the SS Company for fourteen months and could not be honored by the bank. The checks are only good for six months from the date they were written. As a result, the SS company's check is stale.

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