Asked by Tegan Hendrix on Jun 13, 2024
Verified
Where a creditor is financing the inventories of a manufacturer of life preservers, the most sensible security for all involved is a floating charge.
Floating Charge
A debt security issued by a corporation in which assets of the corporation, such as stock-in-trade, are pledged as security. Until such time as default occurs, the corporation is free to dispose of the assets.
Creditor
An entity or person to whom money is owed by a debtor.
Inventories
The total amount of goods and materials held by a company for the purpose of sale or production.
- Understand the objectives of different security agreements and their impact on the entities involved.
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Learning Objectives
- Understand the objectives of different security agreements and their impact on the entities involved.
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