Which of the Following Credit Terms Is the Most Advantageous

question 77

Multiple Choice

Which of the following credit terms is the most advantageous to the purchaser of goods?

• A) 1/10, n/30.
• B) 5/10, n/60.
• C) 2/10, n/30.
• D) 5/10, n/20.

---

Definitions:

Expected Dividend Rate

An estimate of the yearly dividend per share that a company plans to pay out to its shareholders.

Future Net Income

The projected earnings of a company after all expenses and taxes have been subtracted from revenue, indicating expected profitability.

Transferability of Ownership

The legal capability to transfer ownership rights of an asset or property from one entity to another.

Shareholder

An individual or entity that owns one or more shares in a company's stock, giving them partial ownership and possibly voting rights within the company.