When Applying for Credit, Lenders Will Consider Your

question 42

Multiple Choice

When applying for credit, lenders will consider your:

• A) Capacity
• B) Collateral
• C) Character
• D) All of the above
• E) None of the above

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Definitions:

Management Assessment

An evaluation process where management reviews financial and operational performance, often for strategic decision-making.

Interest

The cost of borrowing money, expressed as a percentage of the amount borrowed, paid by the borrower to the lender.

Note Receivable

A financial asset representing a written promise for a debtor to pay a certain amount of money to the holder of the note on a specific date or on demand.

Percent of Sales Method

A financial planning tool used to forecast future revenues, expenses, or balance sheet figures as a percentage of sales.