Mike Operates an Upholstering Business

question 30

Multiple Choice

Mike operates an upholstering business.He goes to Hans' house to reupholster a sofa for Hans.After the work was complete,Hans refused to pay the agreed price.Mike wants to assert a lien against the sofa in order to collect the money due to him.Is Mike entitled to a lien under these circumstances?

• A)Yes,because he is an artisan who improved personal property.
• B)Yes,because Hans owes a debt to Mike.
• C)No,because there is no surety involved in the transaction.
• D)No,because Hans did not give up the possession of the sofa.

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Definitions:

Consolidated Receivables

Consolidated receivables refer to the total amount owed to a company by its customers, after combining the amounts across different divisions or subsidiaries.

Inventory

Inventory refers to the goods and materials that a business holds for the purpose of resale or production, classified as current assets on the balance sheet.

Common Stock

An equity investment representing ownership in a company; holders typically have voting rights and may receive dividends.

Fair Value

A valuation of an asset or liability, determined by the current market prices in a lively market.