On graduation, you start a small business consulting service operating from leased premises, and one year into business you borrow $25,000 from a bank. The best (being the most useful) security the bank can likely get from you is probably
A) a chattel mortgage.
B) a bill of sale.
C) an assignment of book debts.
D) a conditional sale agreement.
E) a right of lien.

Question

Quizplus · Accepted Answer

An assignment of book debts is likely the most useful security for the bank as it gives the bank rights to the money owed to the business by its customers. This provides a direct claim on incoming funds, making it a strong form of security for a loan.

On Graduation, You Start a Small Business Consulting Service Operating