Which of the following statement is incorrect? With the inventory financing, the lender can make surprise visits to the borrower's business, checking to be sure that the pledged assets are on hand, as they should be. When accounts receivable are used for collateral, the borrower pledges to turn over its inventory to the lender if the borrower defaults. Most of the answers are correct. Short-term financing is usually cheaper than long-term financing. A line of credit is a maximum total balance that a bank sets for a firm's outstanding short-term loans