Question 1

Don repays his debt, incurred to buy consumer goods, to EZ Retail Credit and immediately files a written request for a termination statement. EZ​

Accepted Answer

A)  ​must comply within one month of receipt of the letter. 
B)  ​must comply within twenty days of receipt of the letter. 
C)  ​must refund $500 to Don. 
D)  ​need not comply. 
A)  ​must comply within one month of receipt of the letter. 
B)  ​must comply within twenty days of receipt of the letter. 
C)  ​must refund $500 to Don. 
D)  ​need not comply.

Question 2

The payment of Valley Farm's debt to County Bank is guaranteed by the farm's personal property. This property is​

Accepted Answer

A)  ​a future advance. 
B)  ​after-acquired property. 
C)  ​a floating lien. 
D)  ​collateral. 
A)  ​a future advance. 
B)  ​after-acquired property. 
C)  ​a floating lien. 
D)  ​collateral.

Question 3

Fiscal Credit Corporation asks Global Industries, Inc., to agree to a security agreement that provides for coverage of the proceeds from the sale of after-acquired property. This is​

Accepted Answer

A)  ​the first-in, first-out rule. 
B)  ​a floating lien. 
C)  ​a violation of most state laws. 
D)  ​a future advance. 
A)  ​the first-in, first-out rule. 
B)  ​a floating lien. 
C)  ​a violation of most state laws. 
D)  ​a future advance.

Question 4

Once default has occurred and the secured party has obtained possession of the collateral, the secured party has no more options.

Accepted Answer

A) True 
 B)False

Question 5

Metro Motors files a financing statement giving notice to the public that it has a secured interest in collateral belonging to Nate's Limousine Service, which is the debtor named in the statement. A uniform financing statement used in all states is​

Accepted Answer

A)  ​the UCC Financing Statement. 
B)  ​the UCC Collateral Form. 
C)  ​Form UCC-2. 
D)  ​none of the choices. 
A)  ​the UCC Financing Statement. 
B)  ​the UCC Collateral Form. 
C)  ​Form UCC-2. 
D)  ​none of the choices.

Question 6

Fact Pattern 20-1
General Leasing Company (GLC) buys equipment for use as inventory, borrowing $1 million from Business Finance Corporation for a security interest in the equipment. The next day, GLC borrows $500,000 from Commercial Bank, also for a security interest in the equipment. GLC defaults on the loans.
-Refer to Fact Pattern 20-1.Suppose that Business Finance perfects its security interest when GLC takes possession of the equipment. In that circumstance, the party with priority to the collateral on GLC's default would be​

Accepted Answer

A)  ​GLC. 
B)  ​Business Finance and Commercial Bank proportionately. 
C)  ​Business Finance only. 
D)  ​Commercial Bank only. 
A)  ​GLC. 
B)  ​Business Finance and Commercial Bank proportionately. 
C)  ​Business Finance only. 
D)  ​Commercial Bank only.

Question 7

A security interest that provides for a security interest in collateral subject to future advances is a floating lien.

Accepted Answer

A) True 
 B)False

Question 8

The last security interest to be perfected is the first in priority over any other perfected security interests.

Accepted Answer

A) True 
 B)False

Question 9

Credit Financing, Inc., and Equity Lending Company are secured parties with security interests in property owned by Fleet Shipping Corporation. Priority between these security interests is generally determined by​

Accepted Answer

A)  ​the amount of the claim. 
B)  ​the custom in the trade. 
C)  ​the time of perfection or attachment. 
D)  ​the "float" of the liens. 
A)  ​the amount of the claim. 
B)  ​the custom in the trade. 
C)  ​the time of perfection or attachment. 
D)  ​the "float" of the liens.

Question 10

Kyla holds a security interest in inventory owned by Luc. Kyla protects her claim to the inventory in the event of Luc's default by​

Accepted Answer

A)  ​assignment. 
B)  ​perfection. 
C)  ​redemption. 
D)  ​retention. 
A)  ​assignment. 
B)  ​perfection. 
C)  ​redemption. 
D)  ​retention.

Question 11

Market Credit Corporation is the secured party in a secured transaction with Northwest Outfitters. Market Credit could also be referred to as​

Accepted Answer

A)  ​the debtor. 
B)  ​the secured creditor. 
C)  ​the security interest. 
D)  ​the filing officer. 
A)  ​the debtor. 
B)  ​the secured creditor. 
C)  ​the security interest. 
D)  ​the filing officer.

Question 12

Advances against lines of credit can be subject to a perfected security interest in certain collateral.

Accepted Answer

A) True 
 B)False

Exam 20: Secured Transactions

Don repays his debt, incurred to buy consumer goods, to EZ Retail Credit and immediately files a written request for a termination statement. EZ​

The payment of Valley Farm's debt to County Bank is guaranteed by the farm's personal property. This property is​

Fiscal Credit Corporation asks Global Industries, Inc., to agree to a security agreement that provides for coverage of the proceeds from the sale of after-acquired property. This is​

Once default has occurred and the secured party has obtained possession of the collateral, the secured party has no more options.

Metro Motors files a financing statement giving notice to the public that it has a secured interest in collateral belonging to Nate's Limousine Service, which is the debtor named in the statement. A uniform financing statement used in all states is​

A security interest that provides for a security interest in collateral subject to future advances is a floating lien.

The last security interest to be perfected is the first in priority over any other perfected security interests.

Credit Financing, Inc., and Equity Lending Company are secured parties with security interests in property owned by Fleet Shipping Corporation. Priority between these security interests is generally determined by​

Kyla holds a security interest in inventory owned by Luc. Kyla protects her claim to the inventory in the event of Luc's default by​

Market Credit Corporation is the secured party in a secured transaction with Northwest Outfitters. Market Credit could also be referred to as​

Advances against lines of credit can be subject to a perfected security interest in certain collateral.

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Digital Update:the Exploding World of Digital Property

Filters

Don repays his debt, incurred to buy consumer goods, to EZ Retail Credit and immediately files a written request for a termination statement. EZ

The payment of Valley Farm's debt to County Bank is guaranteed by the farm's personal property. This property is

Fiscal Credit Corporation asks Global Industries, Inc., to agree to a security agreement that provides for coverage of the proceeds from the sale of after-acquired property. This is

Metro Motors files a financing statement giving notice to the public that it has a secured interest in collateral belonging to Nate's Limousine Service, which is the debtor named in the statement. A uniform financing statement used in all states is

Credit Financing, Inc., and Equity Lending Company are secured parties with security interests in property owned by Fleet Shipping Corporation. Priority between these security interests is generally determined by

Kyla holds a security interest in inventory owned by Luc. Kyla protects her claim to the inventory in the event of Luc's default by

Market Credit Corporation is the secured party in a secured transaction with Northwest Outfitters. Market Credit could also be referred to as