Donaldo China Inc Is an Importer of Plates Operating in Toronto.It

question 39

Multiple Choice

Donaldo China Inc is an importer of plates operating in Toronto.It borrowed $100 000 from Barings Bank and, in a written agreement, gave the bank a security interest in its inventory.The bank filed a financing statement to register its security interest for two years in 2010.The bank's registration expired in December 2012.In April 2013, Donaldo becomes bankrupt.A trustee in bankruptcy is appointed to administer the estate of Donaldo.Which of the following statements is TRUE?

• A)The trustee in bankruptcy will treat Barings's security claim as an unsecured debt.
• B)Barings's security interest was perfected so it is can be enforced against Donaldo's assets even though Donaldo is bankrupt.
• C)Because Barings's interest had attached, it is enforceable against third parties like the trustee in bankruptcy.
• D)Because Barings's has a security interest, the trustee has a discretion to treat it as a secured creditor.
• E)Barring's security interest automatically is perfected by the bankruptcy and therefore takes priority.

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External Environment

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