Able Finance Corp Carries on a Lending Business in Saint

question 47

Multiple Choice

Able Finance Corp carries on a lending business in Saint John, New Brunswick.Athos Transport has asked Able to acquire a truck trailer and then lease it to Athos for five years in return for monthly payments which will cover the full amount of the purchase price plus 10 percent.At the end of the lease term, Athos has an option to buy the trailer for $100.Assuming that Able and Athos enter into this transaction, which of the following is TRUE? The New Brunswick Personal Property Security Act

• A)applies to this transaction because, in substance, it gives Able a security interest in the trailer.
• B)does not apply to this transaction because the form of the transaction is a lease.
• C)applies to this transaction because the lease is for a term exceeding one year.
• D)applies to this transaction because this lease is equivalent to secured bank financing.
• E)does not apply to this transaction because, under the lease, Able will have title to the trailer, not a security interest.

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Definitions:

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