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Amol Srivastava
Amol Srivastava, Accountant
Category: Finance
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Experience:  More than 4years + of industry experience ,CFA level2 cleared, Chartered Accountant from India
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40) Which method of controlling pledged inventory provides

Resolved Question:

40) Which method of controlling pledged inventory provides the greatest degree of security to the lender?
A. Trust receipts
B. Warehousing
C. Overall inventory liens
D. Blanket inventory liens

41) General Rent-All's officers arrange a $50,000 loan. The company is required to maintain a minimum checking account balance of 10% of the outstanding loan. This practice is called
A. a discounted loan.
B. a balloon payment.
C. a compensating balance.
D. an installment loan.

42) A large manufacturing firm has been selling on a 3/10, net 30 basis. The firm changes its credit terms to 2/20, net 90. What change might be expected on the balance sheets of its customers?
A. Increased payables and decreased bank loans
B. Increased payables and increased bank loans
C. Increased receivables and increased bank loans
D. Decreased receivables and increased bank loans
Submitted: 8 years ago.
Category: Finance
Expert:  Amol Srivastava replied 8 years ago.
40 - D
41 - B
42 - C
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