The Receivable That Is Usually Evidenced by a Formal Instrument

question 118

Multiple Choice

The receivable that is usually evidenced by a formal instrument of credit is a(n)

• A)trade receivable.
• B)note receivable.
• C)accounts receivable.
• D)income tax receivable.

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Definitions:

Selling Price

The amount of money for which a product or service is offered for sale to customers.

Contribution Margin Ratio

The percentage of revenue remaining after variable costs have been subtracted, indicating how much revenue is available to cover fixed costs and generate profit.

Contribution Margin

The amount remaining from sales revenue after variable expenses are deducted, indicating how much contributes towards covering fixed costs and generating profit.

Variable Costs

Costs that change in proportion to the level of activity or volume of production in a business.