____ Promises to Pay the Beneficiary If They Buyer Fails

question 11

Multiple Choice

____ promises to pay the beneficiary if they buyer fails to pay as agreed.

• A) A standby L/C
• B) A transferable L/C
• C) Assignment of proceeds
• D) None of the above

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Definitions:

Withdrawals

Amounts of money taken out from a business by its owner(s) for personal use.

Provision

An amount set aside in the accounts of a company to cover a future liability or decrease in the value of an asset.

Accounts Receivable

Liabilities of customers to a firm for provisions or merchandise that have been delivered but payment is outstanding.

Capital Balance

The amount recorded in a shareholder's or partner's equity account, reflecting their investment in the business.