Which of the Following Is Not a Potential Fraud Related

question 23

Multiple Choice

Which of the following is not a potential fraud related to debt obligations?

• A) Long-term or short-term debt is misclassified.
• B) Entire loan payments are charged to either principal or interest.
• C) Dividends are paid in violation of restrictive covenants.
• D) Debt obligations are not properly authorized.

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Definitions:

Interest Rate

The percent of principal charged by the lender for the use of its money, or the amount earned on deposited funds.

Loan Liability

A financial obligation representing money borrowed that must be repaid, with interest, to the lender.

Exchange Rates

The speed at which one country's currency can be traded for another's, impacting global trade and investment activities.

Calendar Year End

Indicates the end of the fiscal year for a business or organization that aligns with the end of the calendar year, December 31.