The Payback Year Is the Year in Which the Cumulative

question 141

Multiple Choice

The payback year is the year in which the cumulative total cash flow is greater than or equal to ____.

• A) $0
• B) the value of the business
• C) the amount of the last payment
• D) the original loan amount

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Definitions:

Outstanding Deposits

Money that has been deposited into a bank account but has not yet been processed or credited to the account.

Outstanding Check

One that has been written but hasn’t yet cleared the bank and been charged to the customer’s account.

Adjusted Cash Balance

An amount reflecting the true cash balance after accounting for outstanding checks or deposits in transit.

Check Register

A check register is a record book used to track checks written, deposits made, and the current balance of a checking account.