When a Company Lends Cash to a Customer Who Signs

question 126

Multiple Choice

When a company lends cash to a customer who signs a promissory note:

• A) net income decreases for the current accounting period, but increases when the money is repaid.
• B) expenses increase in the current accounting period but revenues increase when the money is repaid.
• C) liabilities increase when the transaction occurs but decrease when the money is repaid.
• D) net assets and net income do not change when the transaction occurs.

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Definitions:

Pinna

The visible part of the ear that is outside the head, responsible for collecting sound waves and directing them into the ear canal.

Eardrum

A thin, cone-shaped membrane that separates the external ear from the middle ear, and vibrates in response to sound waves.

Taste Preferences

Individual differences in liking or disliking certain flavors and foods.

Innate

Inborn or natural characteristics, qualities, or abilities not acquired through learning or experience.