Regarding Zero-Interest-Bearing Notes

question 65

Multiple Choice

Regarding zero-interest-bearing notes,

• A) they do not have an interest component.
• B) the debtor receives the future value of the note and pays back the present value.
• C) any interest is never recognized until the note is repaid.
• D) the debtor receives the present value of the note and pays back the future value.

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Definitions:

Ace

A term often associated with achieving excellence or a high level of skill in a particular area.

Contractor

A person or corporation that agrees to a contract to supply materials or workforce to execute a service or complete a task.

Lien

A legal right or claim against a property by a creditor to ensure the payment of a debt.

County Clerk

An official in local government who manages public records and documents, particularly in relation to property and civil records.