Dave's Hardware Store Defaults on a Debt to Equity Bank

question 27

Multiple Choice

Dave's Hardware store defaults on a debt to Equity Bank, which takes possession of the collateral securing the debt. The bank sells the collateral. The proceeds from the sale are applied first to​

• A) ​the balance of Dave's debt to the bank.
• B) ​Dave's debts to other creditors.
• C) ​the bank's expenses for the sale.
• D) ​the minimum amount Dave's needs to stay in business.

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Definitions:

Freight Terms

Conditions in a shipping agreement that define the responsibilities of buyers and sellers, including who pays for shipping, insurance, and other costs.

Goods

Tangible items that are manufactured or produced for sale and use, often referring to items of merchandise or inventory.

Right of Return

The right of return is a policy that allows customers to return purchased goods within a specified period for a refund, exchange, or credit.