Part III Discuss concisely each scenario in not less than 5 sentences.41-45Simple interest is a cost of using a money. In loans, it may be treated as an expenses on the part of theborrower and may be viewed as income on the part of the creditor. If you are a business owner which is morefavorable to you, a borrower or a creditor? Why?

The benefits of being a borrower or a creditor are subject to the needs of the business and the…

Answered: Part III Discuss concisely each…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A good credit rating would be based on all the following criteria EXCEPT whether you a. have a record of paying what you owe on time. b. have little or no current debt. c. use credit for regular expenses. d. can afford to take on more credit. e. have used credit appropriately in the past.
Which is not a metric used by lenders to measure the overall suitability of a loan: 1) Loan to value ratio 2) Debt service coverage 3) Debt yield. 4) Effective rent per square foot choose 1
4. When do you considered a loan, receivables are impaired?
QUESTION 1 Which if the following is not true of the 5Cs in evaluating credit quality Character refers to the integrity and honesty of the borrower and applies to both individuals and companies Capital refers to the savings or wealth of the borrower as an additional source of income to repay the loan Collateral refers to assets that are pledged to lender Capacity refer to external factors including the state of economy that can impact the borrower’s source of income. QUESTION 2 Which of the following is not true? Firm A Firm B Industry Benchmark 2018 2019 2020 2018 2019 2020 2018 2019 2020 ROA 9.14% 9.50% 9.90% 8.11% 8.16% 8.19% 8.11% 8.14% 8.15% ROE 22.45% 22.95% 23.45% 19.65% 19.88% 20.12% 19.95% 20.55% 21.00% TIE 1.75 1.65 1.55 2.75 2.90 3.05 2.25 2.30 2.50 CR 3.25 3.66 3.75 2.55 2.65 2.75 2.40 1.45 2.50 EPS…
4. Consider the following two statements (1) Businesses should deny credit to customer to eliminate the costs of collecting trade receivables. (2) Trade receivable factoring could provide immediate funds to businesses after credit sales. Which one of the following combinations relating to the above statements is correct? A (1) True (2) False B (1) True (2) True C (1) False (2) True D (1) False (2) False
(1) How does getting a secured loan using accounts receivable as collateral differ from factoring? (2) Why would lenders want to see that a business already has some level of capitalization before giving it access to more capital by means of a loan?
Which of the following is not use to assess whether credit should be extended to a household? a. The amount of income earned. b. The amount of debt outstanding. c. The history of timely repayments of debt owed. d. Whether the loan is secured by an asset. e. All of the above are used to assess credit.
D3 These statements are True or False? Please explain. 1. The role performed by banks in which thay stand behind their customers when those customers are unable to pay a debt obligation is known as the discounting valuable paper role. 2. Collaterals should be considered as the primary resource to pay off the loans
1.) A credit card is which of the following? All of the answers are correct Is one part of a comprehensive strategy to managing a person’s finances Makes it extremely easy for a person to mess up their finances Is nothing more than a tool Is a huge convenience 2.) A debt – to income ratio can easily be calculated be from a what kind of statement? Investment Budget Bank Tax Net worth 3.) What is it that almost all lenders evaluate of anyone applying for a loan? Certainty Income Risk Payback Credit 4.) Credit and debt are two of the most crucial means available to achieve personal financial: Intentions Objectives Goals Reasons Ideas 5.) Debt allows an economy to appear very large but debt also creates more ____ in an economy. Inevitability Surety Certainty Risk Business 6.) Eventually, some potential borrowers can get to the point that they present so much _______ that no lender will loan them anything at all. Cash Money Work Risk Trouble 7.) _______ is simply external indicator of…
4. If you are a borrower, it is better to borrow money in a lender who offers _______.
If after sometime, I haven't paid yet my accounts payable to you, and you don't expect that I can pay you, you will recognize an expense called bad debt expense. Is this either true or false? please explain thanks.
1.what do you mean by Accountancy? 2. Classification of asset? 3.what do you mean by goodwill? 4.what is bad debt? 5.who is the creditor?

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