What Effect Does the Collection of a Note Receivable,excluding Interest,have

question 152

Multiple Choice

What effect does the collection of a note receivable,excluding interest,have on the accounting equation?

• A)Total assets remain the same.
• B)Assets are reduced and stockholders' equity is reduced.
• C)Assets are increased and stockholders' equity is increased.
• D)Assets are reduced and liabilities are reduced.

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Definitions:

Goodwill

An intangible asset that arises when a business is acquired for more than the fair value of its net identifiable assets, reflecting the company's brand, customer base, and other non-physical assets.

Restriction

A rule or condition that limits or controls someone's actions or a particular activity.

Business Elsewhere

The decision by a customer to take their business to a competitor or alternative provider, usually due to dissatisfaction.

Necessary

Items or services considered essential for basic living and survival, often distinguishing between luxury goods and necessities for legal and economic purposes.