An Exception to Disbursements Being Made by Check Is Acceptable

question 151

Multiple Choice

An exception to disbursements being made by check is acceptable when cash is paid

• A) to an owner.
• B) to employees as wages.
• C) from petty cash.
• D) to employees as loans.

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Definitions:

Inflation

The pace at which prices for general goods and services ascend, thus diminishing the capability to purchase.

Real Interest Rate

The interest rate adjusted for the inflation rate, reflecting the real cost of borrowing and the real yield to lenders or investors.

Nominal Interest Rate

The rate of interest before adjusting for inflation, representing the face value of interest payments.

Inflation Rate

The tempo at which the broad cost of goods and services rises, leading to a downfall in purchasing strength.