26-78 What Is Defined as the Sum of the Products

question 61

Multiple Choice

26-78 What is defined as the sum of the products of the time when principal payments are received and the amount of principal received all divided by total principal outstanding?

• A)Weighted-average life.
• B)Burn-out factor.
• C)Degree of collateralization.
• D)Option-adjusted spread.
• E)Time to maturity.

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Definitions:

Contra Asset

An account on a company’s balance sheet holding a balance that is opposite to the normal account balance, such as accumulated depreciation.

Accrued Expense

An expense that has been incurred but not yet paid or recorded in the accounting records.

Annual Property Taxes

Taxes levied by local governments on the value of real estate property, paid yearly by the property owners.

Paid

Refers to the status of having settled an obligation or receiving compensation for services or goods.