Suppose A, a farmer, deposits certain grain in a warehouse (usually, however, the man who purchases the grain from the farmer will be the one to do this). He secures a receipt and is entitled to the possession of the grain on payment of the charges. He then wishes to sell the grain to B. He indorses the receipt to B and is paid for it (only in the case of a negotiable receipt, and most receipts are made negotiable). It may also be used as collateral for the advancement of funds. Of course, when a receipt is negotiable, it may be passed any number of times. Again, terminal elevator companies often buy a great deal of grain and to do so must borrow heavily at the banks. To get the loans they deposit as collateral, elevator receipts, which are regarded as good security. When the grain is sold the loans are paid and the receipts surrendered.