It Is Good Business Practice of Have a Written Record

question 35

Multiple Choice

It is good business practice of have a written record of a contract because

• A) a written record is more accurate that human memory.
• B) many disputes can be avoided by keeping an accurate record.
• C) provisions of long term contracts will not have to be committed to memory.
• D) human memories are fallible.
• E) all of the above

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Definitions:

Mortgage Payable

A long-term liability account that records the amount owed on a property mortgage.

Current Assets

Items on a company's balance sheet anticipated to be cashed in, sold off, or utilized within the longer span of either one year or its operational cycle.

Current Liabilities

Obligations or debts that a company expects to settle within one year or within the normal operating cycle of the business.

Liquidity

The ease with which an asset, or security, can be converted into ready cash without affecting its market price.