Which of the following comparisons between short-term bank loans is correct?
A) Commercial paper interest rates are usually slightly higher than rates on bank loans.
B) Commercial paper is only appropriate for firms requiring a limited amount of short-term financing, while banks can offer substantially larger amounts of funds.
C) Banks demand that borrowers meet exacting credit-worthiness tests, while the lenders that purchase commercial paper are less strict. Only the most credit-worthy borrowers have access to bank loans.
D) Commercial paper is less flexible than a line of credit, but the interest rate is lower.
Answer: D
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Peavey Enterprises purchased a depreciable asset for $24,500 on April 1, Year 1. The asset will be depreciated using the straight-line method over its four-year useful life. Assuming the asset's salvage value is $2500, what will be the amount of accumulated depreciation on this asset on December 31, Year 3?
A. $18,333.3333 B. $15,125 C. $4583.33 D. $22,000 E. $5500
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Answer the following statement true (T) or false (F)