Which of the Following Is Not True About the Discount

question 7

Multiple Choice

Which of the following is not true about the discount on short-term notes payable?

• A) The Discount on Notes Payable account has a debit balance.
• B) The Discount on Notes Payable account should be reported as an asset on the balance sheet.
• C) When there is a discount on a note payable, the effective interest rate is higher than the stated discount rate.
• D) Discount on Notes Payable is a contra account to Notes Payable.

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Definitions:

General Adaptation Syndrome

A three-phase response (alarm, resistance, exhaustion) that the body goes through in reaction to long-term stress.

Exhaustion Stage

The final phase of the stress response, where the body runs out of energy for adapting to stressors and may result in decreased health and functioning.

Latency Stage

A phase in Freud's psychosexual development occurring from around age six to puberty, where sexual urges are dormant, and focus shifts to social and intellectual growth.

Stagnation Stage

A phase in Erikson's psychosocial development theory typically experienced in middle adulthood, where individuals may struggle with being productive and contributing to society.