What May a Creditor Do in Response to an Application

question 19

Multiple Choice

What may a creditor do in response to an application for credit from a business with gross revenues of $1 million or less?

• A) Give a disclosure of the applicant's right to receive a statement of reasons at the time of the application instead of at the time of the adverse action
• B) Mention adverse action notices only if requested by the applicant
• C) Omit the ECOA statement on all notices NOTES
• D) Provide only the ECOA statement to the applicant

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Definitions:

Weighted-Average Method

An inventory costing method that assigns a cost to inventory on the basis of the average cost of all similar items in inventory, weighted by the quantity of each item.

Direct Materials Cost

The cost of raw materials and components that go directly into the production of a product.

Work In Process Inventory

The value of all the materials, labor, and overhead costs for products that are partially completed by a company.

Equivalent Unit

A measure used in cost accounting to express the amount of work done on units of production during a period, considering partially completed units.