When a Borrower Receives the Face Amount of a Discounted

question 164

Multiple Choice

When a borrower receives the face amount of a discounted note less discount, this amount is known as:

• A) the note proceeds
• B) the note discount
• C) the note deferred interest
• D) the note principal

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Definitions:

Sole Proprietorships

A form of business ownership with a single owner who manages the company and is responsible for all business debts.

Partnerships

Legal arrangements in which two or more parties agree to operate a business together, sharing its profits and liabilities.

Corporations

Corporations are legal entities separate from their owners, created to conduct business, can own assets, incur liabilities, and are subject to taxation.

Account Receivable

Money owed to a business by its clients or customers for goods or services delivered but not yet paid for.