Three ways in which liabilities are used to finance business activities.

Question

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Answer 1

Question

Chapter 10, Problem 1Q

To determine

To Describe: Three ways in which liabilities are used to finance business activities.

Expert Solution & Answer

Explanation of Solution

Liabilities: Liabilities are referred to as the obligations of the business towards the creditors for operating the business. Liabilities may be short-term or long-term depending upon the time duration in which it is paid back to the creditors.

The ways in which liabilities are used to finance business activities are as follows:

1. Liabilities are generated when a company purchases goods and services on credit.
2. Liabilities are obtained from the short-term bank loans to cover cash flows gaps in the business.
3. Liabilities are created from the issue of long-term debt to obtain cash for expanding the business.

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Answer 2

Question

Chapter 10, Problem 1Q

To determine

To Describe: Three ways in which liabilities are used to finance business activities.

Expert Solution & Answer

Explanation of Solution

Liabilities: Liabilities are referred to as the obligations of the business towards the creditors for operating the business. Liabilities may be short-term or long-term depending upon the time duration in which it is paid back to the creditors.

The ways in which liabilities are used to finance business activities are as follows:

1. Liabilities are generated when a company purchases goods and services on credit.
2. Liabilities are obtained from the short-term bank loans to cover cash flows gaps in the business.
3. Liabilities are created from the issue of long-term debt to obtain cash for expanding the business.

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Answer 3

Question

Chapter 10, Problem 1Q

To determine

To Describe: Three ways in which liabilities are used to finance business activities.

Expert Solution & Answer

Explanation of Solution

Liabilities: Liabilities are referred to as the obligations of the business towards the creditors for operating the business. Liabilities may be short-term or long-term depending upon the time duration in which it is paid back to the creditors.

The ways in which liabilities are used to finance business activities are as follows:

1. Liabilities are generated when a company purchases goods and services on credit.
2. Liabilities are obtained from the short-term bank loans to cover cash flows gaps in the business.
3. Liabilities are created from the issue of long-term debt to obtain cash for expanding the business.

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Answer 4

Question

Chapter 10, Problem 1Q

To determine

To Describe: Three ways in which liabilities are used to finance business activities.

Expert Solution & Answer

Explanation of Solution

Liabilities: Liabilities are referred to as the obligations of the business towards the creditors for operating the business. Liabilities may be short-term or long-term depending upon the time duration in which it is paid back to the creditors.

The ways in which liabilities are used to finance business activities are as follows:

1. Liabilities are generated when a company purchases goods and services on credit.
2. Liabilities are obtained from the short-term bank loans to cover cash flows gaps in the business.
3. Liabilities are created from the issue of long-term debt to obtain cash for expanding the business.

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Answer 5

Chapter 10, Problem 1Q

To determine

To Describe: Three ways in which liabilities are used to finance business activities.

Expert Solution & Answer

Explanation of Solution

Liabilities: Liabilities are referred to as the obligations of the business towards the creditors for operating the business. Liabilities may be short-term or long-term depending upon the time duration in which it is paid back to the creditors.

The ways in which liabilities are used to finance business activities are as follows:

1. Liabilities are generated when a company purchases goods and services on credit.
2. Liabilities are obtained from the short-term bank loans to cover cash flows gaps in the business.
3. Liabilities are created from the issue of long-term debt to obtain cash for expanding the business.

Answer 6

Chapter 10, Problem 1Q

To determine

To Describe: Three ways in which liabilities are used to finance business activities.

Expert Solution & Answer

Explanation of Solution

Liabilities: Liabilities are referred to as the obligations of the business towards the creditors for operating the business. Liabilities may be short-term or long-term depending upon the time duration in which it is paid back to the creditors.

The ways in which liabilities are used to finance business activities are as follows:

1. Liabilities are generated when a company purchases goods and services on credit.
2. Liabilities are obtained from the short-term bank loans to cover cash flows gaps in the business.
3. Liabilities are created from the issue of long-term debt to obtain cash for expanding the business.

Answer 7

Chapter 10, Problem 1Q

To determine

To Describe: Three ways in which liabilities are used to finance business activities.

Answer 8

Expert Solution & Answer

Explanation of Solution

Liabilities: Liabilities are referred to as the obligations of the business towards the creditors for operating the business. Liabilities may be short-term or long-term depending upon the time duration in which it is paid back to the creditors.

The ways in which liabilities are used to finance business activities are as follows:

1. Liabilities are generated when a company purchases goods and services on credit.
2. Liabilities are obtained from the short-term bank loans to cover cash flows gaps in the business.
3. Liabilities are created from the issue of long-term debt to obtain cash for expanding the business.