A Firm Repays $4000 of an Existing Bank Loan

question 43

Multiple Choice

A firm repays $4000 of an existing bank loan. The transaction is recorded as which of the following entries?

• A) DR Bank loan $4000; CR Owner's capital $4000
• B) DR Cash at bank $4000; CR Accounts receivable $4000
• C) DR Cash at bank $4000; CR Bank loan $4000
• D) DR Bank loan $4000; CR Cash at bank $4000

---

Definitions:

Capital Gain Yield

The increase in the price of an investment, calculated as the percentage difference between the current price and the purchase price.

Rate Of Total Return

A measure of the overall return on an investment, including both capital gains and income, expressed as a percentage of the initial investment.

Income Yield

The return on an investment expressed as a percentage of the investment’s cost.

Total Return

A measure of the overall return on an investment, including both capital appreciation and dividends or interest, over a specific period.