Which of the following methods CANNOT be employed by lenders to control inventory that has been used as security for a loan?
A)blanket liens
B)trust receipts
C)warehousing
D)compensating balance

Question

Quizplus · Accepted Answer

Compensating balance is not a method of controlling inventory used as security for a loan. Compensating balance is a requirement from the lender that the borrower maintain a minimum balance in a deposit account with the lender. This is not directly related to the control of inventory. Blanket liens, trust receipts, and warehousing are all methods that lenders can employ to control inventory that has been used as security for a loan.

Which of the Following Methods CANNOT Be Employed by Lenders