Answer (B) is correct . A warehouse receipt is issued by a person engaged in the business of storing goods for hire. Security for short-term inventory financing can be arranged if the debtor places its inventory under the control of the lender or its agent (e.g., a public warehouse), and the lender holds the warehouse receipts.
Answer (A) is incorrect because Commercial paper is a type of unsecured, short-term promissory note issued by large firms to other firms, insurance companies, mutual funds, etc.
Answer (C) is incorrect because A revolving credit agreement is a formal line of credit, usually with a bank, that large firms often use.
Answer (D) is incorrect because A line of credit is an arrangement, which may be formal or informal, between a commercial bank and its customer concerning the maximum loan amount available.
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