Which of the Following Is True About an Open Account

question 67

Multiple Choice

Which of the following is true about an open account as a method of payment?

• A) It requires the buyer to pay the face amount on sight.
• B) It requires the exporter to bill the customer, who is then expected to pay under agreed-on terms at a future date after the goods are manufactured and delivered.
• C) It involves the use of a draft, drawn by the seller on the buyer.
• D) It is the ideal method of payment because a company has immediate use of the money.
• E) It involves wire transfers or the acceptance of credit cards.

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Definitions:

Oxbow Lakes

Crescent-shaped lakes formed when a river meander is cut off from the main stream.

Cutbank

The steep or vertical bank on the outside bend of a river or stream, eroded by flowing water.

Braided Streams

Networks of river channels that are separated by small, often temporary, islands called braid bars, typically found in environments with high sediment loads.

Cutoff Meanders

These are bends in a river that have been isolated from the main flow due to the river carving a shorter path.