Answer True or False, and Explain

question 95

Essay

Answer true or false, and explain.
(A)Although credit cards are not included in the money supply, credit cards linked to your checking account are included in the money supply because of the link to your checking deposits.
(B)Although credit cards are not included in the money supply, the checks the credit card company sends you are included in the money supply, for the same reason that checking deposits are included in the money supply.

Learn the effects of sales discounts on revenue recognition and how they are recorded in financial statements.

Understand the operation of merchandisers and retailers and the role of inventory in their financial transactions.

Grasp the implications and application of credit terms in sales transactions.

Identify the accounting treatment for sales tax payable and the importance of sales tax in financial transactions.

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Definitions:

Bankruptcy Procedure

The legal process under bankruptcy laws for dealing with the debt of individuals or entities that cannot pay their creditors.

Creditors

Individuals or entities that lend money or extend credit to others.

Chapter 13

A type of bankruptcy in the United States that allows individuals with a regular income to develop a plan to repay all or part of their debts.

Payment Plan

An agreement to pay off a debt over a set period of time in scheduled installments.