Nico Likes to Go Shopping

question 11

Multiple Choice

Nico likes to go shopping.Every time he goes to a new store,he fills out an application for a store credit card so that he can get a 20 percent discount on his purchases that day.Yesterday,when he was trying to buy a new car,the dealer turned down his credit request.Nico can't understand why,because he thought he had good credit.If you looked at his credit report,what is the most likely reason he was denied credit?

• A)Nine years ago,a lender referred his debt to a collection agency.
• B)He has only worked for his current employer for nine months.
• C)He has too many recent inquiries on his credit report.
• D)There is not enough information available to answer this question.

---

Definitions:

Accrual-based Income

An accounting method that records revenues and expenses when they are earned or incurred, regardless of when cash transactions occur.

Domestic Corporations

Corporations that are registered and operate within the country of incorporation, adhering to its laws and taxation.

Excess Fair Value

The amount by which the fair value of an asset exceeds its carrying value on the balance sheet, often recognized in business combinations or asset revaluations.

Franchise Contract

A legal agreement granting an individual or group the rights to market a company’s products or services in a specific territory.