ADM 1340 Chapter Notes - Chapter 10: Floating Interest Rate, Current Liability, Sales Tax
20 Apr 2017
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ADM 1340 Full Course Notes
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A floating interest rate is charged on whatever us used. Floating interest rate changes as market interest rates change and is usually based on the prime borrowing rate. Security/collateral is often required by banks as protection against a possible default on the loan by the borrower. Includes some or all of the company"s current assets, maybe even non-current assets. Loc are normally short-term, and are repayable immediately upon bank"s request. Line of credits can result in bank indebtedness. Retailers collect taxes from customers and periodically (usually monthly) sends it to a federal or provincial collecting authority. Sales tax payable is debited and cash is credited when sales taxes are remitted. There"s a specified rate for every of the assessed value of the property. Property taxes are for a calendar year, but the bills are issued during spring. Ex) receiving a bill on march 1, payable may 31:
