The Two Basic Sources of Equity Are

question 50

Multiple Choice

The two basic sources of equity are:

• A) common stock and bonds.
• B) common stock and preferred stock.
• C) paid-in capital and retained earnings.
• D) loans from banks and gifts from donors.

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Definitions:

Interest Receivable

An accounting term for interest income that is earned but not yet received in cash.

Accounts Receivable

The money owed to a business by its customers for goods or services that have been delivered but not yet paid for.

Installment Accounts Receivable

Amounts owed by customers for purchases made on credit that are to be paid in regular, periodic installments.

Non-current Asset

An asset that is not expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business.