If, after collateral is repossessed and sold, there is money left over (a surplus), that money belongs to the creditor to compensate them for the costs of repossession. Select one: O True O False
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A: Financial Asset or Receivables: The financial Asset or Receivables is measured initially at fair…
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A: Amortization is a technique used in accounting to decrease the book value of such a loan or…
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A: Sinking fund is setting aside some money for future possible expenses.
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A: A security interest in an asset that cannot be claimed by any other party is called a perfected…
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A: Indifference price is the price at which the investor is indifferent to investing in any of the two…
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A: The chance of a loss stemming from a borrower's failure to repay a loan or satisfy contractual…
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A: Capital Expenditure: It is a expenditure made by company to acquire or renovate a property, plant or…
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A: Under installment sales contract, buyer is provided a way for goods to be delivered and the payment…
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A: Hedging is a technique or a strategy which is used to reduce any risk involved in investment. This…
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A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…
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A: The contingencies found in permanent or take-out loan commitments and their use are as follows: A…
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A: Leases is an agreement or contract between two parties under which one party provides it's asset for…
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A: This is a False.
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A: A loan is an instrument which is used to raise money. So a borrower can raise money at a defined…
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A: When a period for the performance or fulfillment of an obligation is agreed upon, it is believed to…
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A: Loan Maturity: The time period for which a loan is extended is known as the loan period. The date…
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A: In mortgage loans, collateral is an asset or security used to take loan.
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A: Assets are the resources owned by a business. These are used to generate income for a business and…
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A: SOLUTION- NET PRESENT VALUE = PRESENT VALUE OF CASH INFLOW - PRESENT VALUE OF CASH OUTFLOW.
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A: The note payable is issued to creditors which is to be paid off at the maturity date.
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A: the largest estimated possible loss that could arise in a safe payment schedule are the value of…
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A: There are two methods for valuing anything. The first method is the historical cost method.…
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A: The question is multiple choice question. Required Choose the Correct Option.
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A: Non-current asset refers to the asset which will not realize in cash within a year from the…
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A: Time value of the money is the value of the money which a person must use in order to know how much…
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A: Lender is the person who lends or provides money to other person in return of some interest as well…
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A: Discounting : Discounting determines how much will be the worth of money if it is received today…
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A: Higher inflation rate would lead to higher interest or nominal rate on the borrowed amount. This is…
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A: Term loan is a loan which is given by a bank to the borrower for longer periods usually more than a…
Q: Which of the following case would allow the capitalization of Interest Expense No Case allows…
A: Interest will be capitalised only when the concerned assets is under preparation for its use in…
Q: How does a short term loan works?
A: Definition : A short term loan is a variety of loan that's obtained to support a short lived…
Q: Should liability for rent deposit be amortized? Why or why not?
A: The assets are amortized as they provide benefits for the long period.
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A: Balance of Payments is nothing but the record of the economic transactions of the residents of a…
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A: An accrued liability refers to an expense a business has incurred during a specific period but has…
Q: When a note payable is exchanged for property, the stated interest rate is presumed to be fair when…
A: When a note payable is exchanged for property, the stated interest rate is presumed to be fair when…
Q: Is the following statement is true or false? Amortization is not a payment process.
A: Amortization refers to the process of paying off a debt through scheduled, pre-determined…
Q: in the 5 c's of stracturing a loan approval, what fundamental piece do you think it ignore or fall…
A: Long-term loan: It's a debt instrument that a company uses to raise money. The collateral is…
Q: Question 5: Collateral is a valuable asset that is pledged to ensure loan payments. If you fail to…
A: Collateral is an asset which is pledged by the borrower to the lender to give a security to the…
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- Toms UI IVesuTment to ychciut ed as a cost of borrowing to compensate the opportunity costs of the bank with I to the cash loaned to you. Moreover, the interest rate is usually expressed as nual percentage rate. activity ctions: On the space provided, write TRUE if the idea being expressed is correct and FALSE if otherwise. 1. In the most loan amortization schedules, amortization of discount or premium of the loan increases over time. 2. The process of obtaining future values is called discounting. 3. An annuity in which cash flows occur at the end of each period is called annuity. age1. Modes of extinguishing obligations when creditor abandons his right to collect. (PLEASE EXPLAIN YOUR ANSWER) A. Condonation B. Forfeiture C. Debt D. Damages 2. Fall after the increase reaches a certain variable amount, this is called: (PLEASE EXPLAIN YOUR ANSWER) A. Process factor B. Law of return C. Inflation D. Supply & demand 3. It is always true that the effective rate is greater than the nominal rate when m ≥ 2. (PLEASE EXPLAIN YOUR ANSWER) A. True B. False 4. (A/F, i%, N) = (A/P, i%, N) + i (PLEASE EXPLAIN YOUR ANSWER) A. True B. FalseUse IFRS 9 to determine how to subsequently measure the following financial assets. Three choices of measurement basis are amortized cost, fair value through other comprehensive income, and fair value through profit or loss. Provide justification for your choice. Long-term loans that are held for collecting contractual cash flows till their maturities, but may be subsequently sold if the loans’ credit risk substantially increases. Investments in bonds that are held for collecting contractual cash flows, and may be subsequently sold to re-invest the cash in financial assets with a higher return. Subprime (high risk) mortgage loans that were originated by a mortgage-broker firm that always sell these loans to banks right after their origination. Forward contracts that an EU bank purchased to hedge the exposure to changes in fair value of US$-denominated loans. Investment in bonds that are convertible into common stock of the bond issuer. Investment in bonds that pay a variable market…
- Which of the following is true of an unsecured loan?A. They are exclusively for cars, houses, and other large purchasesB. Collateral could be collected by the lender if the debt is not paidC. They never have any interest added onto themD. Items of value that the borrowers owns are not at risk of repossessionWhich of the following statements is not correct? Select the correct response: The principal amount of a debt is the cash or cash equivalent amount borrowed The carrying amount of a noninterest-bearing note payable due in lump sum will decrease as time goes by When a noncash asset is acquired and the stated rate of interest is different from the current market rate of interest, the cost of the asset is the present value of the future cash payments discounted at the current market rate of interest rather than at the stated interest rate. A company that receives cash in an amount less than the face amount of a noninterest-bearing note payable should record the note at its discounted present value.To account for a down payment, adjust the _____ of the loan by subtracting it from the loan amount. O present value (pv) future value (fv) rate O type
- Which is incorrect regarding annuities? A. Annuities do not use the pooling technique to spread risk B. An owner may change the annuity date, the beneficiary, or the settlement option C. Once the payout period begins, the annuitant receives periodic payments D. The accumulation period is the period prior to the annuitization date 6.Define the following: Condition Civil loss Reciprocal obligations Pure obligation Potestative condition Problems Explain or state briefly the rule or reason for your answer. 1. D (debtor) borrowed P20,000 from C (creditor) payable on or before August 30. Before the arrival of the due date, C agreed to the promise of B to pay C if B wants. Can C insist that B pay not later than August 30? 2. Suppose in the same problem, D obliges himself to pay C P10,000 after C has paid his obligation to T. Is the obligation valid? 3. S (seller) agreed to sell to B (buyer) a specific car for P200,000, delivery of the car and the payment of the price to be made on June 15. Suppose S delivered the car on June 15 but B failed to pay the price, what are the remedies of S? 4. S sold a parcel of land to B for P240,000 payable in installments of P20,000 a year. The land was delivered to B who obtained ownership thereof. After B had paid P200,000, he could no longer continuing paying in view of…When a customer is delinquent on paying a notes receivable, your company has the option to continue to attempt collection or sell the debt to a collection agency. Research the benefits and challenges with each of these options and in a short essay, answer the following questions. A. What are the benefits and challenges of continuing to attempt collection yourself? B. What are the benefits and challenges of selling debt to a collection agency? C. If you had a dishonored notes receivable, which option would you select and why? D. Would you weight certain benefits or challenges differently when making your selection? How?
- Which of the following typically represents an advantage of leasing over purchasing an asset with an installment note? a. Lease payments often are lower than installment payments.b. Leasing generally requires less cash upfront.c. Leasing typically offers greater flexibility and lower costs in disposing of an asset.d. All of the above are advantages of leasing.Identify the types of information that can readily be deter-mined from an amortization table for an installment loan. (More than one answer may be correct.)a. Interest expense on this liability for the current year. b. The present value of the future payments under chang-ing market conditions. c. The unpaid balance remaining after each payment.d. The portion of the unpaid balance that is a currentliability.1. Loans that are to be securitized are passed on to ____ _ _ _ _ _ ___. This helps ensure that if the lender goes bankrupt , it does not affect the credit status of the pooled loans . A. the originator B. a special - purpose entity C. the trustee D. a servicer E. the credit enhance