Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

9. Current Liabilities

Types of Liabilities

Financial Accounting

9. Current Liabilities

Types of Liabilities

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Multiple Choice

Which of the following best describes the difference between a general lien and a specific lien?

A general lien can only be enforced by banks, while a specific lien can be enforced by any creditor.

A general lien attaches to all assets of a debtor, while a specific lien attaches only to a particular asset.

A general lien is created by agreement, while a specific lien arises only by law.

A general lien is only used for secured loans, while a specific lien is used for unsecured loans.

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Verified step by step guidance

Step 1: Understand the concept of a lien. A lien is a legal claim or right against an asset that is used to secure the payment of a debt or obligation.

Step 2: Differentiate between a general lien and a specific lien. A general lien attaches to all assets of a debtor, meaning it applies broadly to everything the debtor owns. A specific lien, on the other hand, attaches only to a particular asset, such as a car or a house.

Step 3: Analyze the options provided in the problem. Evaluate each statement to determine which one accurately describes the difference between a general lien and a specific lien.

Step 4: Eliminate incorrect options. For example, the statement that a general lien can only be enforced by banks is incorrect because general liens are not limited to banks. Similarly, the statement that a general lien is only used for secured loans is not accurate.

Step 5: Identify the correct answer. The correct description is: 'A general lien attaches to all assets of a debtor, while a specific lien attaches only to a particular asset.' This aligns with the definitions of general and specific liens.