What Every Collector Should Know, Part 1

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| By Jtklein
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Jtklein
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| Attempts: 177
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  • 1/30 Questions

    When contacting debtor company ABC Distributing looking for Joe King, the person you speak with advises you that business is no longer in business and the assets have been sold to the new company also called ABC Distributing and they have no liability for your debt.  What should you do next?

    • Call them a liar and demand they pay this debt.
    • Thank them, then submit the account for closure as OOB.
    • Ask who the new principal is and ask for a copy of the sales contract.
    • None of the above
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About This Quiz

To test collectors retention of information provided in the handout "What Every Collector Should Know, Part 1"

Education Quizzes & Trivia

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  • 2. 

    "Blanket settlement authority" means...

    • We can settle an account for whatever we feel is a good number.

    • A piece of bedding material used to make a tent.

    • The client has provided us with a percentage of the balance that they would be willing to accept as settlement in full on any of their accounts.

    • None of the above.

    Correct Answer
    A. The client has provided us with a percentage of the balance that they would be willing to accept as settlement in full on any of their accounts.
    Explanation
    Page 9.

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  • 3. 

    If blanket settlement authority is given on an account, you can find the percentage by..

    • Shift +3

    • Shift +M (for money!)

    • The Z key

    • Asking the collector next to you.

    Correct Answer
    A. The Z key
    Explanation
    Page 9. The "Z" screen displays the percentage the client would be willing to take as full settlement.

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  • 4. 

    Bulk Transfer is defined as any trans­fer or sale in bulk (51% or more of the company's assets) and not in the ordi­nary course of the seller's business of a major part of the materials, supplies, merchandise or other inventory. True or False?

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Page 4

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  • 5. 

    There are specific requirements in the Fraudulent Transaction Act of the UCC covering the sale of bulk assets.  Which of the following is one of them?

    • The buyer must hang a sign in a public place of the business for 6 months prior and 6 months after the sale announcing their intent to buy the business.

    • The seller has no liability once the business has been sold.

    • The seller must provide the buyer with a list of existing creditors.

    • The seller must announce every hour on the hour of their intent to sell the business for 10 days prior to the sale.

    Correct Answer
    A. The seller must provide the buyer with a list of existing creditors.
    Explanation
    Page 4-5.

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  • 6. 

    Fraudulent Conveyance is the illegal transfer of property or assets, the intention­ of which is to defraud creditors or to avoid payment of an obligation.True or False

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Page 6.

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  • 7. 

    On a return call from a debtor after a PIC call, you should always...

    • Ask them out on a date

    • NOT discuss the asset & liability investigation into their financial solvency.

    • Verify their name, position with the company and that they are authorized to speak on behalf of the company and its financial situation.

    • Wish them a Merry Christmas or Happy Hanukah as appropriate.

    • NOT tell them who the client is or the amount referred to us.

    Correct Answer
    A. Verify their name, position with the company and that they are authorized to speak on behalf of the company and its financial situation.
    Explanation
    Page 7. You should never ask them out on a date, but you should always confirm who they are and that they are authorized to speak to their financial situation. You also want to always advise of the A&L and eventually who our client is and how much is due.

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  • 8. 

    Settlement means to...

    • Have lunch early.

    • Stat the client

    • Accept less than the balance owed.

    • Pitch a tent.

    Correct Answer
    A. Accept less than the balance owed.
    Explanation
    Page 9.

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  • 9. 

    Regardless of how a settlement in full of an account is negotiated, all such settlements must be approved by the client. If you should authorize a settlement in full without the client's written approval, the differential between the actual balance and the amount accepted will be deducted from your salary or bonus.True or False?

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Page 9. Clients must always authorize the settlement.

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  • 10. 

    The most common transfer of assets is the asset sale where the secured party has taken over the debtor company or is controlling the sale or transfer of assets. True or False?

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Page 6.

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  • 11. 

    When activating an account, you must verify the phone and address. True or False?

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Page 7. You must use an independt source such as Manta or reverse on Google, to validate the phone number and address.

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  • 12. 

    You receive a returned call from a client on an account about the debtor's credit app.  How would you note the account?

    • You don't have to. The call was not from a debtor.

    • You don't have to. That's sale's responsibility.

    • PB/SC

    • PB/ME

    • IN/IO

    Correct Answer
    A. IN/IO
    Explanation
    All work must be documented. If you take the call, you must document it. This is an incoming call from someone other than the debtor (IN) and it is for information (IO).

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  • 13. 

    The investigative information is only for PIC and not used in the course of collections. True or False?

    • True

    • False

    Correct Answer
    A. False
    Explanation
    Page 7. You should always be prepared to use this information in your initial presentation to the debtor, irrespective of the results of the PIC call.

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  • 14. 

    If no return call from a PIC, you should

    • Call the debtor the next day and recreate the sense of urgency.

    • Properly status the account and date out a week to see if they will call you then.

    • Stat sales that the debtor is not responding

    • Request close and offset as debtor has no intentions to pay.

    Correct Answer
    A. Call the debtor the next day and recreate the sense of urgency.
    Explanation
    Page 8.

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  • 15. 

    You phone the debtor company and speak with the responsible party.  She claims that she has no money.  You work with her and come up with arrangements to satisfy the debt with postdates.  How do you note the account?

    • TR/MN

    • PO/ME

    • ID/MW

    • PB/RP

    • PB/ME

    Correct Answer
    A. PB/RP
    Explanation
    "PB" for "phoned business" and "RP" for "received postdates". If you were unable to get the postdates, the result code would have been "MN" for "no money".

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  • 16. 

    An attorney representing the debtor calls and states during his call that the debtor did not receive one of the three shipments we are attempting to collect.  He offers to resolve this matter with payment for the two shipments the debtor did receive.  What is the best action/result code combination to note this file?

    • AC/MW

    • AC/PD

    • PB/SC

    • IN/ME

    • ID/PP

    Correct Answer
    A. AC/MW
    Explanation
    Attorney called, AC, and you have money working MW. It's not technically a promise to pay as you have not agreed on an amount as the client needs to validate the claim of non-receipt of product and agree to the balance and SIF agreement.

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  • 17. 

    In the initial talk off, after presenting the debtor with the amount due, you should...

    • Ask them when they can pay.

    • Ask them if they are preapred to pay it today, then be quiet knowing that the first to talk loses.

    • Ask them if they need the invoice.

    • Ask them if this sounds about right.

    • Any of the above. Phrasing really doesn't matter

    Correct Answer
    A. Ask them if they are preapred to pay it today, then be quiet knowing that the first to talk loses.
    Explanation
    Page 7-8. Phrasing does matter. Ask them if they are prepared to pay it today then be quite other than maybe reiterating the question again.

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  • 18. 

    Only the debtor may offer a settlement.True or False?

    • True

    • False

    Correct Answer
    A. False
    Explanation
    Page 9. You or the debtor may offer a settlement. Sometimes it's up to you as a collector to get that conversation started.

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  • 19. 

    What type or types of business ownership can all personal and business assets be attached to satisfy the debts of the business?

    • Corporation and Limited Liability Corporation

    • Sole Proprietorship and General Partnership

    • Limited Partners

    • Any of the above

    Correct Answer
    A. Sole Proprietorship and General Partnership
    Explanation
    Page 2. Officers of a corporation, LLC or limited partnership are typically limited to their investment only unless they signed a personal guarantee.

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  • 20. 

    Before sending an account to PIC, you should always...

    • Do a search engine search on the debtor company then call the debtor to test their willingness to pay.

    • Brush your teeth

    • Search for news or a website for the debtor, cross-reference the address & phone, check SOS for corporate make and verify the client provided phone number.

    • Call the client and verify placement, balance and phone number placed, check SOS for other concerned parties, advise sales we are sending to PIC.

    Correct Answer
    A. Search for news or a website for the debtor, cross-reference the address & phone, check SOS for corporate make and verify the client provided phone number.
    Explanation
    Page 7.

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  • 21. 

    In a Bulk Sales transfer, the buyer always automatically has liability. True or False?

    • True

    • False

    Correct Answer
    A. False
    Explanation
    Page 5. The seller always retains liability but that liability could transfer to the buyer if notices are not given as required and the buyer is at fault.

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  • 22. 

    By far, the most common form of a business entity is a...

    • Sole Proprietorship

    • General Partnership

    • Limited Partnership

    • Corporation

    • Foreign Corporation

    Correct Answer
    A. Corporation
    Explanation
    Page 6.

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  • 23. 

    You can filter for action or action and result codes by using...

    • The "+" key

    • The "=" key

    • Shift + Insert keys

    • F3

    • F6

    Correct Answer
    A. The "=" key
    Explanation
    Page 6. It is particularly helpful on drop files when looking for backup or which notices have been sent.

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  • 24. 

    You have been communicating with the debtor.  She asked that you send her the backup via email, which you do.  Over the weekend, she replies to the email that she does in fact owe this debt and is willing to pay this, where would you like the check sent?  What action/result code combination would you use?

    • IR/IO

    • IR/PP

    • ME/MW

    • PB/PR

    • ID/SC

    Correct Answer
    A. ME/MW
    Explanation
    It's an email message (ME) and you have the right party contact with money working (MW).

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  • 25. 

    In a limited partnership, limited partners are liable for debt incurred by the business just like in a general partnership.  True of False?

    • True

    • False

    Correct Answer
    A. False
    Explanation
    Page 3. Limited partners are have no role in day-to-day activities and are typically limited to losing their investment.

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  • 26. 

    A corporation can only be publicly held. True or False?

    • True

    • False

    Correct Answer
    A. False
    Explanation
    Page 3. A corporation may be publicly or privately held.

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  • 27. 

    You receive an incoming call from the debtor. He indicates that this debt has already been paid to the client.  This is a "no call client".  Prior to getting off the account, how would you fully note it?

    • It was probably paid prior. Since it's a "no call client" you just need to send a y-mail to sales.

    • After asking the debtor to forward to you proof of payment, you would use the action result code is ID/PD. You would note the file regarding the call, change the status code to "23" dispute and activity code to "PC". Send a y-mail to the sales rep requesting verification of the direct payment and date the file ahead 3 business days to follow-up on the debtor for proof of payment and the sales/client/accounting for the direct payment verification and posting.

    • After asking the debtor to forward to you proof of payment, you would use the action result code is PB/ME. You would note the file regarding the call, change the status code to "11" pmts to client and activity code to "WR". Send a y-mail to the sales rep requesting verification of the direct payment and date the file ahead 10 business days to follow-up on the debtor for proof of payment and the sales/client/accounting for the direct payment verification and posting.

    • In a paperless environment, you only need to update the action/result code as PB/IO as that says it all.

    • None of the above.

    Correct Answer
    A. After asking the debtor to forward to you proof of payment, you would use the action result code is ID/PD. You would note the file regarding the call, change the status code to "23" dispute and activity code to "PC". Send a y-mail to the sales rep requesting verification of the direct payment and date the file ahead 3 business days to follow-up on the debtor for proof of payment and the sales/client/accounting for the direct payment verification and posting.
    Explanation
    When a debtor makes a claim of payment, always ask for proof of the payment. Since it was an incoming call from the debtor, the action code is ID and since it was paid direct PD is the result code. As the debtor is claiming a different balance, the proper status is 23 for dispute and to further define the dispute, PC for paid to client.

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  • 28. 

    Certain businesses are not included in the bulk sales act, such as cleaning shops, barber shops, pool halls, hotels and anything service oriented. True or False?

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Page 5.

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  • 29. 

    In a privately owned corporation...

    • Creditors can look to officers to satisfy the corporations debt

    • Creditors can only look to the to the corporation for settlement of their claim

    • Creditors can look to officers personally to satisfy the corporations debts is they signed a personal guaranty.

    • Both B and C

    Correct Answer
    A. Both B and C
    Explanation
    Page 3.

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  • 30. 

    When Metairie Bates scans back up onto the Bates drive, they note the file in the transaction notes with the action code:

    • BM

    • IM

    • ME

    • MM

    • None of the above

    Correct Answer
    A. MM
    Explanation
    Page 6.

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Quiz Review Timeline (Updated): Mar 15, 2023 +

Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.

  • Current Version
  • Mar 15, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Mar 10, 2010
    Quiz Created by
    Jtklein

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