Which of the Following Is True of Commercial Paper

question 15

Multiple Choice

Which of the following is true of commercial paper?

• A)It is a secured long-term debt instrument issued by corporations.
• B)It is always issued via an underwriter.
• C)It may help a corporation to raise funds often at rates below those banks charge.
• D)All corporations can tap the commercial paper market.

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Definitions:

LIFO Inventory Cost Method

An inventory valuation method that assumes the last items purchased are the first ones sold, affecting the company's bookkeeping and tax calculations.

Current Revenues

Income received by an entity within its normal business operations and within the current accounting period.

Lower-Of-Cost-Or-Market

An accounting principle that values inventory at the lesser of its historical cost or the market replacement cost, ensuring inventory is not overstated.

Inventory Valuation

The method used to calculate the cost associated with an inventory, which can impact the cost of goods sold and net income.