Mortgage Prepayments Are Generally A(n)________ to the Mortgage Borrower and A(n)________

question 76

Multiple Choice

Mortgage prepayments are generally a(n) ________ to the mortgage borrower and a(n) ________ to the mortgage investor.

• A)advantage; advantage
• B)advantage; disadvantage
• C)disadvantage; advantage
• D)disadvantage; disadvantage
• E)advantage; neutral event

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Definitions:

Expired Cost

A cost that has been incurred and recognized as an expense, reflecting the consumption of an asset or a service in generating revenue.

Monetary Unit Assumption

An assumption that requires that only those things that can be expressed in money are included in the accounting records.

Asset Prepayments

Payments made in advance for goods or services, recorded as assets on the balance sheet until used or expired.

Time Period Assumption

An accounting principle that allows the business operations to be divided into specific time periods for reporting purposes, such as months or years.