Under the UCC, to Avoid the Problem of Constantly Issuing

question 483

Multiple Choice

Under the UCC, to avoid the problem of constantly issuing new financing contracts every time a business buys more inventory from a supplier, the parties may use:

• A) a priority interest
• B) a tangible property lien
• C) a floating lien
• D) a perfected lien
• E) none of the other choices

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Definitions:

Assets

Resources owned by a company that have economic value and can contribute to future income.

General Ledger

The primary accounting record of a company that uses double-entry bookkeeping, containing all the financial accounts and transactions of a business.

Accounts

Records summarizing all transactions related to a particular item over a period.

Posting

The process of transferring entries from the journal to the respective accounts in the ledger.