Which Statement Based on Textbook Discussion Is True About Debit

question 1

Multiple Choice

Which statement based on textbook discussion is true about debit or credit cards?

• A)A debit card draws against either an account the user has with a financial institution or a prior payment of money made to the card issuer.
• B)Credit card transactions provide the greater profit to financial institutions.
• C)Debit cards provide greater protection as a matter of law to the consumer.
• D)Debit and credit cards are treated identically by the law.

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Definitions:

Maturity Value

The total amount payable to an investor at the end of a fixed-term investment, including the principal and any accrued interest.

Adjusting Entry

An entry made in the accounting records at the end of an accounting period to allocate income and expenses to the period in which they actually occurred.

Interest

The charge for the privilege of borrowing money, typically expressed as an annual percentage rate.

Allowance Method

An accounting technique used to estimate and account for bad debts, allowing a company to anticipate and reduce accounts receivable to a more realistic value.