Assume You Are the Creditor in Each of the Following

question 83

Essay

Assume you are the creditor in each of the following situations. Identify the kind of security agreement that is involved in each transaction and explain how you would perfect that agreement.
_a. You are the creditor (Evergromby Bank), and you lend Brisco Baines $5,000 for a sound system.
b. National Bank loans Donna $5,000 to purchase a computer for use in her store office.
c. Garth needs cash for gambling debts. He brings in his gold ring to secure a $500 loan.
_{This is a purchase money security interest in consumer goods. It is automatically}

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Definitions:

Check Clearing

Check clearing is the process through which banks verify and process the transfer of funds from the check issuer's account to the recipient's account, finalizing the transaction.

Transit Float

The time difference between when a payment is made and when it is available in the recipient's account.

Processing Float

The time delay between when a check is written and when it is actually deducted from the payer's account, often utilized in managing company cash flows.

Cash Balances

Cash balances refer to the amount of currency, coins, and balances in checking and savings accounts that a company holds at any given time.