Ch29-TB2-WBL-10e - Chapter29 SecuredTransactions...

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Chapter 29 Secured Transactions N.B.:   TYPE  indicates that a question is new, modified, or unchanged, as  follows. N A question  new  to this edition of the Test Bank. + A question  modified  from the previous edition of the Test Bank, = A question  included  in the previous edition of the Test Bank. TRUE/FALSE QUESTIONS 1. A security interest is enforceable only if the collateral is  not  in the debtor’s  possession. ANSWER: F PAGE: 581 TYPE: N 2. A security interest is not enforceable   after   the creditor’s rights have at- tached to the collateral. ANSWER: F PAGE: 581 TYPE: N 3. Collateral is the subject of a security interest. ANSWER:  T PAGE: 581 TYPE: + 4. For a  creditor  to have an enforceable security interest, the  debtor  must have  title to the collateral. ANSWER:  F PAGE: 582 TYPE: N 5. A financing statement is  not  effective if it is filed electronically. 37
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38 TEST BANK 2—UNIT SIX: CREDITORS’ RIGHTS AND BANKRUPTCY ANSWER: F PAGE: 585 TYPE: + 6. A financing statement is effective  only  if it is filed electronically. ANSWER: F PAGE: 585 TYPE: N
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CHAPTER 29: SECURED TRANSACTIONS 39 7. A security agreement’s description of collateral as “all the debtor’s assets” is  sufficient to reasonably identify the property. ANSWER:  F PAGE: 588 TYPE: = 8. An improper filing renders a secured party unperfected. ANSWER: T PAGE: 588 TYPE: + 9. A pledge is a promise by a debtor to take reasonable care of the collateral. ANSWER:  F PAGE: 589 TYPE: + 10. A   purchase-money   security   interest   in   consumer   goods   is   perfected  automatically at the time of a credit sale. ANSWER:  T PAGE: 589 TYPE: = 11. A financing statement is effective for five years from the date of filing. ANSWER:  T PAGE: 589 TYPE: = 12. A secured creditor’s right to cash proceeds exists for twenty days after re- ceipt only if the cash is forwarded to the secured party. ANSWER: F PAGE: 590 TYPE: = 13. The concept of the floating lien applies to after-acquired inventory. ANSWER:  T PAGE: 591 TYPE: + 14. The concept of the floating lien does  not  apply to future advances. ANSWER:  F PAGE: 591 TYPE: N 15. A buyer in the ordinary course of business takes goods free of any security  interest in the seller’s inventory. ANSWER: T PAGE: 592 TYPE: + 16. When two parties have perfected security interests in the same collateral,  neither party has priority.
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40 TEST BANK 2—UNIT SIX: CREDITORS’ RIGHTS AND BANKRUPTCY ANSWER: F PAGE: 593 TYPE: +
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CHAPTER 29: SECURED TRANSACTIONS 41 17. A secured party can release the collateral described in a filed financing  statement only if the debtor has paid the debt.
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