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Yuri [45]
2 years ago
11

When interest is accrued on a note payable, but not paid, the A. Interest Expense account is increased; the Interest Payable acc

ount is decreased. B. Notes Payable account is increased; the Interest Payable account is increased. C. Interest Expense account is increased; the Interest Payable account is increased. D. Interest Expense account is decreased; the Interest Payable account is increased.
Business
1 answer:
olchik [2.2K]2 years ago
8 0

Answer:

C. Interest Expense account is increased; the Interest Payable account is increased.

Explanation:

A secured interest can be defined as a legal right granted by a borrower to a lender (creditor) over a collateral (the borrower's property) which permits or allow the lender to have a right to possess the property as soon as the lender defaults in making payment. The payment which is expected to be made by the borrower of a mortgage loan is considered a secured obligation because it is a lien or an enforceable legal claim.

When interest is accrued on a note payable, but not paid, the Interest Expense account is increased; the Interest Payable account is increased.

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The principal purpose of a statement of cash flows is to measure the profitability of a business that maintains its accounting r
Alexus [3.1K]

Answer:

False

Explanation:

The principal purpose of a statement of cash flows is to measure the profitability of a business that maintains its accounting records on the cash basis.

This is False because cash flows are also made for businesses that accounting records on the accrual basis rather than cash basis.

The cash flow is computed both by Direct and Indirect methods.

In indirect method of Cash flow Net income is computed using accrual income which recognizes revenues when earned and expenses when incurred.

5 0
3 years ago
Read 2 more answers
Which three factors make starting a business a highly risky investment?
Alika [10]
The correct options are B, C and E.
Starting a business can be a risky move because of some elements which are involved in creating a new business. For instance, large amount of capital is needed to start a typical business and the uncertain conditions which prevails in the business world can make one to lose one's capital in no time at all. The extent to which assets can be converted to cash is also one of the risks that one must considered.
3 0
3 years ago
Warren, Inc. purchased a $400,000 life insurance policy on the company president on January 1, 2017. The premium that was paid o
stealth61 [152]

Answer: $10,400

Explanation:

4 0
3 years ago
Dr. Khoury is a chiropractor with his own practice in a rapidly growing community and would like to add staff members to his bus
sveta [45]

Answer:

C

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Just took the test

6 0
2 years ago
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Suppose that $2500 is placed in a savings account at an annual rate of 5%, compounded quarterly. Assuming that no withdrawals ar
babymother [125]

Answer:

number of periods = 8 years.

Explanation:

We know,

Future Value = Present value × (1 + r)^{n}

Here,

Present value = PV = $2,500

Future value = FV = $3,500

Interest rate (Compounding) = 5% = 0.05

We have to determine how many years (Periods) it will take, n = ?

Putting the values into the above formula,

$3,500 = $2,500 × (1 + 0.05)^{n}

or, (1 + 0.05)^{n} = $3,500 ÷ $2,500

or, n log 1.05 = 1.4

or, n × 0.17609 = 1.4

or, n =  1.4 ÷ 0.17609

Therefore, number of years = 7.95 or 8 years.

5 0
2 years ago
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