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Which of the Following Is True About Non-Interest Bearing Notes

Question 30

Multiple Choice

Which of the following is true about non-interest bearing notes?


A) The most common method of determining the fair value of non-interest bearing notes is the discounted cash flow analysis.
B) Non-interest bearing short-term payables may never be measured at the original invoice amount.
C) A rule of thumb is to use the face value for non-interest bearing notes payable with a duration of greater than 90 days.
D) A rule of thumb is to use the market value for non-interest bearing notes payable with a duration of 90 days or less.

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