From the Banker's Point of View, Short-Term Bank Credit Is

question 117

Multiple Choice

From the banker's point of view, short-term bank credit is an excellent way of financing

• A) fixed assets.
• B) permanent working capital needs.
• C) repayment of long-term debt.
• D) seasonal bulges in inventory and receivables.

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Definitions:

Sales Tax

A government-imposed levy on the sale of goods and services, contributing to public revenue.

Allowance Method

An accounting technique used to manage accounts receivable and bad debts by estimating uncollectible accounts.

GAAP

Generally Accepted Accounting Principles, a set of accounting standards and practices used in the United States to ensure the accuracy and consistency of financial reporting.

Bad Debt Expense

A charge to the income statement that represents the amount of non-collectable accounts receivable that occurs in a given period.