Which of the following is a requirement for a security interest to 'attach' under UCC Article 9?

Answer options:

Filing a financing statement.

The debtor must have title to the collateral.

The debtor must have rights in the collateral.

The creditor must take possession of the collateral.

How to approach this question

Recall the 3 requirements for attachment: 1) Agreement (or possession), 2) Value given, 3) Debtor has rights.

Full Answer

C.The debtor must have rights in the collateral.✓ Correct

Attachment requires three elements: (1) Value must be given by the creditor, (2) The debtor must have rights in the collateral, and (3) There must be an authenticated security agreement (or possession/control). Filing is for perfection, not attachment.

Common mistakes

Confusing Attachment (creation of right against debtor) with Perfection (protection against third parties).

Question 31 All questions Question 33

Practice the full CPA REG Practice Exam 2

72 questions · hints · full answers · grading

More questions from this exam

Q01A CPA is representing a client in an IRS examination regarding a complex tax shelter transaction....Hard Q02A tax return preparer is facing a penalty for an understatement of tax liability on a client's re...Hard Q03Taxpayer L received a Statutory Notice of Deficiency (90-day letter) from the IRS regarding a tax...Hard Q04A CPA is sued for common law negligence by a third party who relied on the CPA's audit report. Th...Hard Q05Which of the following communications between a CPA and a client would generally be protected by ...Hard

View all 72 questions →