What Is the Name Given to a Subsidiary of a Firm

question 56

Multiple Choice

What is the name given to a subsidiary of a firm that exists solely to handle the credit functions of the parent company?

• A)Internal credit organization
• B)Bank
• C)Credit association
• D)Captive finance company
• E)Credit union

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Definitions:

Account Payable

Money owed by a business to its suppliers or creditors for goods and services purchased on credit, considered a current liability.

Owner's Equity

The residual interest in the assets of the entity after deducting liabilities, representing the ownership interest of shareholders.

Cash Payment

A transaction that involves the immediate transfer of cash from the buyer to the seller for the purchase of goods or services.

Liabilities

Financial obligations or debts that a company owes to others, which must be paid back in the future.