Assume That Your Client Has a Judgment for $250,000 Against

question 94

Essay

Assume that your client has a judgment for $250,000 against X, who lives in your state. You know that X has $100,000 in liability insurance, a $100,000 home and land, a small cottage worth $60,000 (but only $15,000 paid for), two vehicles each worth $10,000 (both paid for), a boat worth $7,000, and an online coffee business that generates $30,000 in gross annual income. Under your state statutes, what of X's assets are not exempt from execution on the judgment?

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Definitions:

Account Receivable

Amounts owed to a company by customers for goods or services that have been delivered or used but not yet paid for.

Reportable Segments

These are operational segments of a business that have distinct financial data available, and whose results are regularly reviewed by the entity’s chief operating decision maker.

Profits Test

A criterion used to evaluate the profitability of a business or investment, often assessing whether revenues exceed costs or expenses to determine financial viability.

Assets Test

A financial measure used to determine eligibility for certain government benefits based on the value of one's assets.