Guy Owns a Lumber Yard, Working Directly with Homebuilders and Contractors

question 120

Essay

Guy owns a lumber yard, working directly with homebuilders and contractors. Margie, a contractor new to the area, wants to set up a credit account with the lumber yard. She has a good history of successful and profitable projects. What questions should Guy ask in evaluating the Margie's credit status?

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Definitions:

Market Value

The ongoing rate at which services or assets are being traded in the market.

Organization Costs

Costs incurred in the formation of a corporation.

Retained Earnings

Retained Earnings refer to the portion of net income left after dividends are paid out to shareholders, which is then reinvested in the company or used to pay down debt.

Intangible Asset

Assets that lack physical substance but are valuable because of the advantages or rights they provide to a business.