An applicant's capacity to repay its requested credit can be found by ________.
A) analyzing financial statements
B) checking bank account balances
C) analyzing tax payment history
D) checking the covenants

Question

Quizplus · Accepted Answer

Analyzing financial statements can provide important information about an applicant's financial position, including their income, expenses, and ability to repay debts. Bank account balances and tax payment history can also be useful in evaluating an applicant's capacity to repay, but may not provide a comprehensive picture of their financial situation. Checking the covenants is not directly related to an applicant's capacity to repay, but rather refers to the terms and conditions of a loan agreement.

An Applicant's Capacity to Repay Its Requested Credit Can Be