Exam L4M3 Topic 7 Question 100 Discussion

Actual exam question for CIPS's L4M3 exam
Question #: 100
Topic #: 7
Company A buys a lorry from Company B on hire purchase. During the contractual period, Company A makes default in paying the instalment. Company B has...?

Suggested Answer: A Vote an answer

Hire purchase is an arrangement for buying expensive consumer goods, where the buyer makes an initial down payment and pays the balance plus interest in installments. Ownership is not transferred until the end of the agreement, hire purchase plans offer more protection to the vendor than other sales or leasing methods for unsecured items. That's because the items can be repossessed more easily should the buyer be unable to keep up with the repayments.
The answer is that Company B has the right to take repossession of the lorry.
Reference:
- Hire Purchase Agreements
- CIPS study guide page 70
LO 1, AC 1.3

by Elsie at Jul 11, 2025, 04:12 AM

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