Giff Services Company Experienced Some Difficulties with Cash Flow So

question 87

Multiple Choice

Giff Services Company experienced some difficulties with cash flow so it approached one of its vendors about a payment extension. The vendor agreed to the extension on the condition that the company sign a note that includes 9% interest. What is the impact on the accounting equation of recording a note payable in exchange for the account payable?

• A)Both assets and liabilities increase.
• B)Both assets and liabilities decrease.
• C)Liabilities increase and stockholders' equity decreases.
• D)There is no net impact, as there are corresponding increases and decreases in liability accounts.

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Definitions:

"4-40" Schedule

A compressed workweek schedule where employees work four days a week, totaling forty hours.

Flexible Working Hours

Employment terms that allow employees to choose their working hours within certain agreed-upon limits to balance work and personal life.

Daily Work Hours

The number of hours an individual is expected to work each day, which can vary based on the employer, job role, and country's labor laws.

Greater Autonomy

The increased independence and freedom to make decisions without external control, often leading to higher job satisfaction and productivity.