The Two Forms of Secured Borrowing That Companies Use to Obtain

question 103

True/False

The two forms of secured borrowing that companies use to obtain cash from accounts receivables are pledging and assigning.

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Definitions:

Creditors

Persons or entities to whom money is owed by debtors or borrowers.

Full Payment

The complete settlement of a debt or obligation, leaving no balance.

Court Approval

The formal endorsement by a judge or court of an action, agreement, or decision before it can legally take effect.

Preferential Payment

A payment made by a debtor that favors one creditor over others, often scrutinized in bankruptcy proceedings.