A Car Loan That a Bank Grants to You Is

question 42

Multiple Choice

A car loan that a bank grants to you is

• A)a source of funds to you, but a use of funds to the bank.
• B)a use of funds to you, but a source of funds to the bank.
• C)a source of funds to both you and the bank.
• D)a use of funds to both you and the bank.

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Definitions:

Liabilities

Obligations owed by a business to individuals or other entities, ranging from loans and mortgages to accounts payable.

Continuity Assumption

An accounting principle that assumes the business will continue operating indefinitely, not being forced to cease operations or liquidate.

Foreseeable Future

A time period in which an event or action is predicted or expected to occur.

Economic Benefits

The advantages or gains received by an individual, company, or society from financial activities or investments.