You are a retailer of motorcycles. You purchase your inventorydirectlyfrom manufacturers and you pay

You are a retailer of motorcycles. You purchase your inventorydirectlyfrom manufacturers and you pay for the motorcycles in your showroom byborrowingfrom alocal bankto purchase each one. Thelocal bankhas filed aUCC‐1 financing statement on yourinventory.You also take specialty motorcycles intoinventory onconsignmentand youcurrentlyhave a usedHarley Davidson Roadster in inventoryon such arrangement. Theconsignor oftheHarleyhas also filed aUCC‐1 financing statementrelating to theconsigned motorcycle.You sell the Harley to a customer who comes to your store. You agree to finance the purchase of theHarley so you enter into an agreement with the purchaser, Jake, that Jake will pay for the motorcycle in36monthly installments. Jake signs a sales agreement and a promissory note and exchanges the note for the motorcycle.Jake will be using the motorcycle in his door‐to‐door delivery service in the city.You sell the note to an investor at a discount and receive cash.Questions: Cite UCC provisions in your answers!5. What if there is no issue with your bank but Jake fails to pay the promissory note you sold. Canthe holder of the note get the Harley back from Jake? What would that depend on?6. If Jake takes the Harley out for his first ride and the front tire flies off thereby causing seriousinjury to Jake, should Jake be able to recover from you? From Harley Davidson? Why/why not.What may this depend on?UCC-1 Filing = Notice from creditor to debtorUCC-9 = ConsignmentUCC Article 9 Section 65 = Promissory Notes

 

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