Which of the Following Is Not an Advantage That Promissory

question 82

Multiple Choice

Which of the following is not an advantage that promissory notes have over trade credit from the perspective of the seller?

• A) Notes are legally binding agreements.
• B) Most notes earn interest for the seller.
• C) Notes are negotiable instruments.
• D) The company extending credit can sell the note and receive the money quickly.
• E) The seller may demand payment from the buyer at any time.

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Definitions:

Gain Or Loss

The financial result that occurs when the selling price of an asset differs from its carrying amount at the time of sale or disposal.

Sinking Fund Bond

A type of bond that includes a fund set aside by the issuer to repay the bond at maturity, ensuring the bond's eventual payoff.

Specific Assets

Specific assets are identifiable and tangible assets like machinery, land, or buildings that a company owns and utilizes in its operations.

Board Of Directors

A group of individuals elected by the shareholders of a corporation to oversee and make decisions on behalf of the corporation.