The Difference Between an Ordinary Annuity and an Annuity Due

question 47

Multiple Choice

The difference between an ordinary annuity and an annuity due is:

• A)the interest rate
• B)the timing of the payments
• C)the amount of the payments
• D)the number of periods

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Definitions:

Revenue Journal

A specialized accounting journal used to record the sales of goods and services and revenue generated.

Accounts Receivable

This term represents money owed to a business by its clients for goods or services delivered but not yet paid for.

Controlling Account

A general ledger account that summarizes the total amounts listed in a subsidiary ledger.

Cash Payments Journal

A financial journal that records all cash payments made by a business, including expenses, asset purchases, and debt payments.