Finance And Accounting

Question: What would the entry be for a monthly interest payment on a long term loan?
A
Dr: Interest Expense, Cr: Cash

B
Dr: Cash, Cr: Interest Expense

C
Dr: Long Term Liability, Cr: Interest Expense

D
Dr: Interest Expense, Cr: Long Term Liability

Note: Answer not sure
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Question: What is the purpose of covenants?
A
They are required by law to be placed on all borrowers

B
To force a borrower to abide by rules which compel the borrower to stay in a situation where they can repay the loan

C
The IRS forces the lenders to place them on all commercial loans

D
To protect the borrower

Note: Answer not sure
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Question: What is a loan that has a fixed rate of interest over a period of time known as?
A
Coupon Payment Loan

B
Conforming Mortgage loan

C
Balloon Loan

D
Term Loan

Note: Answer not sure
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Question: What is meant by the term "Forbearance"?
A
A postponement of payment on a loan, typically if the borrower doesn't qualify for a deferment and is unable to make payments for a reason such as poor health

B
A step taken during bankruptcy

C
An extra loan payment made to pay down principal

D
None of these

Note: Answer not sure
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Question: Why have the lenders been restricting the issuance of credit cards in recent years?
A
Because consumer credit ratings have been going down rapidly

B
Because higher bankruptcy and non payment levels by consumers have been eating into the profit levels

C
Because consumers have nothing else to buy

D
Because there is a tendency among consumers to take out home loans instead

Note: Answer not sure
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Question: What is something that has been made payable and is overdue and unpaid called?
A
Commission

B
Promissory note

C
Delinquent

D
Repossessed

Note: Answer not sure
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Question: How would a company that purchased a building using a mortgage show it in its account books?
A
Dr: Cash, Cr: Interest Payable

B
Dr: Buildings, Cr: Mortgage Liability

C
Dr: Interest Payable, Cr: Mortgage Liability

D
Cr: Cash, Cr: Mortgage Liability

Note: Answer not sure
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Question: What type of repayment plans do credit cards typically have?
A
Exactly half is due

B
Some small portion of the consumer's total balance is due each month

C
They must be paid in full

D
Only interest is due each month

Note: Answer not sure
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Question: What does the term "Collateral" mean?
A
Assets pledged to secure the repayment of a loan

B
The monthly payment of a loan

C
Only the principal portion of a loan

D
A situation where one fails to make a payment, which can lead to foreclosure

Note: Answer not sure
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Question: When do lenders require Private Mortgage Insurance (PMI)?
A
When the loan to value ratio is greater than 80%

B
When the buyer makes under $40,000 a year

C
When the buyer has unfavorable credit

D
When the buyer is a millionaire

Note: Answer not sure
1. Report

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Question: What would the entry be for a monthly interest payment on a long term loan?

Question: What is the purpose of covenants?

Question: What is a loan that has a fixed rate of interest over a period of time known as?

Question: What is meant by the term "Forbearance"?

Question: Why have the lenders been restricting the issuance of credit cards in recent years?

Question: What is something that has been made payable and is overdue and unpaid called?

Question: How would a company that purchased a building using a mortgage show it in its account books?

Question: What type of repayment plans do credit cards typically have?

Question: What does the term "Collateral" mean?

Question: When do lenders require Private Mortgage Insurance (PMI)?