- 1 Marks
Question
The following are the major characteristics of a floating charge EXCEPT, it is
A. Not attached to any particular asset or assets of the company
B. Attached to a particular asset or assets of the company
C. Ambulatory and shifting in nature
D. Equitable in nature
E. A form of company security
Answer
Answer: B
Explanation:
The correct answer is “B. Attached to a particular asset or assets of the company.” Unlike fixed charges, floating charges do not attach to specific assets of a company until crystallization. They cover a pool of assets that change over time.
- Tags: Company Security, Floating Charge
- Level: Level 1
- Topic: Company Law
- Series: MAY 2015
- Uploader: Joseph