Dave's Hardware Store Defaults on a Debt to Equity Bank

Multiple Choice

Dave's Hardware store defaults on a debt to Equity Bank, which takes possession of the collateral securing the debt. The bank sells the collateral. The proceeds from the sale are applied first to​

A) ​the balance of Dave's debt to the bank.
B) ​Dave's debts to other creditors.
C) ​the bank's expenses for the sale.
D) ​the minimum amount Dave's needs to stay in business.