When a Long-Term Note Payable with a Fixed Interest Rate

question 4

Multiple Choice

When a long-term note payable with a fixed interest rate has fixed principal payments, it means that

• A)the periodic payment amount is fixed.
• B)the periodic payment increases over time.
• C)the periodic payment decreases over time.
• D)no conclusion can be made on the periodic payment.

---

Definitions:

Processing Department

A unit within a manufacturing facility where a specific type of production activity takes place.

Journal Entry

A record of the financial transactions entered into the accounting ledger of a business.

Production Process

The series of steps or actions taken to convert raw materials into finished goods or services.

Units Started

The number of units of product that have entered the production process but may not yet be completed.