A Loan Is a Liability to the Issuer but an Asset

question 163

True/False

A loan is a liability to the issuer but an asset to the person taking it out.

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Definitions:

Journal Entries

The records of financial transactions in the accounting system, documented in chronological order.

Voucher

A document that serves as evidence for a transaction and authorizes the payment or receipt of money.

Normal Balance

The side of an account (debit or credit) that is expected to have a higher balance based on the accounting rules.

Financial Statement

A formal record of the financial activities and position of a business, person, or other entity, typically including balance sheet, income statement, and cash flow statement.