Carolyn, a Lessee in Possession of a Leased Piece of Equipment

question 72

Multiple Choice

Carolyn, a lessee in possession of a leased piece of equipment, fails to make payments on the equipment as required. What remedy does Raul, the lessor, have under the UCC 2A-525(2) ?

• A) The right to put a lien on the lessee.
• B) The right to sue the lessee under federal law.
• C) The right to bring a tort action
• D) The right to reclaim the goods
• E) No remedy is provided and common law contract remedies will suffice.

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Definitions:

Tax Deductible

Expenses that can be subtracted from gross income to reduce the amount of income subject to tax.

Deferred Tax Asset

A tax benefit arising from temporary differences between the book value and tax basis of assets and liabilities, which will result in deductible amounts in future periods.

Deferred Tax Liability

A tax obligation that arises from temporary differences between the book value and tax value of assets and liabilities, to be paid in the future.

Accumulated Depreciation

The total amount of a tangible asset's cost that has been allocated as depreciation expense over the asset's useful life.