Which of the Following Is NOT an Example of the Exception

question 22

Multiple Choice

Which of the following is NOT an example of the exception to the rule regarding liquidated debt?

• A)A debtor offers a credit card company a rare book in full settlement of a $3,000 debt and the credit card company accepts.
• B)A car owner offers her car to the bank as full settlement of the remaining balance owed on the loan and the bank accepts.
• C)A debtor disputes the amount of money that is owed,so does not pay half of the debt and the creditor cashes the check.
• D)A student offers the use of his picture in a school brochure in full settlement of the $100 debt he owes to the university bookstore and the school accepts.
• E)There are no exceptions to the rule regarding liquidated debt.

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Definitions:

Tax Expense

The total amount of taxes a company is required to pay on its earnings.

Interest Expense

The cost incurred by an entity for borrowed funds over a period of time, typically reported on the income statement.

Minimum Required Rate Of Return

This term refers to the lowest return that investors expect for an investment, considering the risk involved.

Operating Expenses

Non-production costs incurred by a business in the process of earning revenues, such as selling, general, and administrative expenses.