Allowances, Like Discounts; Refer to

question 296

Multiple Choice

Allowances, like discounts; refer to

• A)rewards given to retailers to encourage early payment.
• B)payment extensions given in exchange for continual contracts.
• C)list price deductions based on surges in consumer demand.
• D)list price deductions based on sudden drops in consumer demand.
• E)reductions from list or quoted prices to buyers for performing some activity.

---

Definitions:

Interest Annually

The payment received or paid out for the use of money on a yearly basis.

Principal Due

The amount of the original loan or bond issue that is still owed, excluding interest payments.

Discount Rate

The interest rate used to discount future cash flows to their present value, important in the evaluation of investment opportunities.

Monthly Payments

Regular payments made over a period of time, often associated with loans or leases.