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Short-term notes payable: Multiple Choice O O O O Are normally categorized as noncurrent liabilities. Are a conditional promise to pay. Cannot replace an account payable. Rarely involve interest charges. Can be issued in return for money borrowed from a bank.

Short-term notes payable: Multiple Choice O O O O Are normally categorized as noncurrent liabilities. Are a conditional promise to pay. Cannot replace an account payable. Rarely involve interest charges. Can be issued in return for money borrowed from a bank.

FINANCIAL ACCOUNTING
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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Question 19
**Short-term notes payable:** **Multiple Choice** 1. Are normally categorized as noncurrent liabilities. 2. Are a conditional promise to pay. 3. Cannot replace an account payable. 4. Rarely involve interest charges. 5. **Can be issued in return for money borrowed from a bank.** (Correct Answer) Explanation: Short-term notes payable are financial obligations that a company needs to pay back within a year. They are often issued in exchange for money borrowed from a bank. Unlike long-term notes, they are classified as current liabilities on the balance sheet and typically involve a promise to repay the borrowed amount with interest within a specified short-term period.
Transcribed Image Text:**Short-term notes payable:** **Multiple Choice** 1. Are normally categorized as noncurrent liabilities. 2. Are a conditional promise to pay. 3. Cannot replace an account payable. 4. Rarely involve interest charges. 5. **Can be issued in return for money borrowed from a bank.** (Correct Answer) Explanation: Short-term notes payable are financial obligations that a company needs to pay back within a year. They are often issued in exchange for money borrowed from a bank. Unlike long-term notes, they are classified as current liabilities on the balance sheet and typically involve a promise to repay the borrowed amount with interest within a specified short-term period.
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