Some Businesses Will Accept Only Customer Payments Made by Credit

question 27

Multiple Choice

Some businesses will accept only customer payments made by credit cards or debit cards despite having to pay service fees for each transaction. Which of the following is the best reason for not accepting cash payments?

• A) Cash can transmit diseases.
• B) Handling cash costs money.
• C) Checking for counterfeit bills is time-consuming.
• D) Employees frequently steal cash.

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Definitions:

Capital Lease

A lease agreement that is considered a purchase of an asset for accounting purposes, with the lessee assuming both the benefits and risks of ownership.

Interest Expense

The cost incurred by an entity for borrowed funds, calculated as the principal times the interest rate over a period.

Residual Value

The estimated value that an asset will have at the end of its useful life, often used in calculating depreciation.

Capital Lease

A type of long-term lease agreement in which the lessee essentially buys an asset and pays for it over the lease term, with the asset's ownership potentially transferring to the lessee at the lease's end.