When a Customer Buys Services on Account, It Should Be

question 92

Multiple Choice

When a customer buys services on account, it should be recorded by the company as:

• A) a debit to Cash and a credit to Accounts Receivable.
• B) a debit to Accounts Receivable and a credit to Revenue.
• C) a credit to Unearned Revenue and a debit to Inventory.
• D) a debit to Cash and a credit to Accounts Payable.

Analyze the impact of varying interest rates on yield and the implications for bond investors.

Understand the concept and financial mechanics behind tranches in Collateralized Debt Obligations (CDOs).

Differentiate between various mortgage pass-through agencies and their role in the housing finance system.

Assess the reasons behind the 2007 mortgage crisis and the failure of mortgage-backed CDOs.

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Definitions:

Creative Intelligence

The ability to go beyond existing ideas to create novel and interesting ones, a component of Sternberg's triarchic theory of intelligence.

Savant Syndrome

A condition where someone with significant mental disabilities demonstrates profound and prodigious capacities or abilities in limited areas.

Emotional Intelligence

The ability to be aware of, control, and express one's emotions, and to handle interpersonal relationships judiciously and empathetically.

Divergent Thinking

A thought process or method used to generate creative ideas by exploring many possible solutions.