ABC Signed a 5-Year,9% Note Payable for $80,000 on May

question 75

Multiple Choice

ABC signed a 5-year,9% note payable for $80,000 on May 1,2012.Which account will be credited when the note paid at maturity?

• A) Note payable
• B) Interest expense
• C) Interest payable
• D) Cash

Recognize common pitfalls in cost analysis and decision making.

Understand the importance of considering opportunity costs in decision-making.

Comprehend the significance of fixed costs, their behavior, and their impact on decision-making.

Understand the concept of contribution margin and its importance in break-even analysis.

---

Definitions:

Investments Account

An account on the balance sheet that reports the cost of investments held by an entity, such as stocks, bonds, or real estate.

Balance Sheet

A financial statement that shows the assets, liabilities, and shareholders' equity of a company at a specific point in time, providing a snapshot of a company's financial condition.

Dividend Yield

A financial ratio that shows how much a company pays out in dividends each year relative to its stock price.

Common Stock

Certificates issued by a corporation to investors as proof of their ownership rights; an account representing the ownership rights of investors in a corporation; a class of stock issued by a corporation that bears no preference rights.