The Simplest Inventory Financing Method Is a Blanket Inventory Lien

question 111

True/False

The simplest inventory financing method is a blanket inventory lien where items are not identified or tagged, and there is no physical transfer of control of the inventory from the borrower.

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Definitions:

Subsidiary Accounts

Detailed records that support and summarize information in a controlling account, often used for individual items or customers.

Cash Refund

An amount paid by the seller to the buyer for merchandise that is defective, is damaged during shipment, or does not meet the buyer’s expectations.

Cash Payments Journal

The special journal in which all cash payments are recorded.

Account Receivable

Money owed to a company by its debtors for goods or services that have been delivered or sold but not yet paid for.