Chapter 1

Question 1

is an arrangement to receive cash, goods or services now and pay for them later.

Answer 1

Credit

Question 2

it connotes trust on the borrower’s capacity and willingness to pay

Answer 2

To a lender

Question 3

it is the ability to obtain goods or services in exchange for a promise to pay

Answer 3

To the borrower

Question 4

defines as a transaction involving the transfer of goods, services, funds, property, or rights, thereby creating an obligation on the part of those who receive them, that must be complied with in the future

Answer 4

Credit

Question 5

2 parties

Answer 5

Creditor and debtor

Question 6

providing the goods, services, funds, property, or a right

Answer 6

Creditor

Question 7

who receives any of them, will have the obligation to comply with this obligation by promising to pay for them in cash, in kind or to return the thing borrowed

Answer 7

Debtor

Question 8

Goods. Groceries, appliances, medicines, hardware

Answer 8

Creditor, debtor

Question 9

Services. Car repair, beauty parlor services, electrical current

Answer 9

Creditor, debtor

Question 10

Funds. Cash loan from a pawnshop, bank, or a friend

Answer 10

Lender, borrower

Question 11

Property. A hammer for a temporary use by a neighbor, a car for use in an errand (personal property); a beachhouse for use for a weekend (real property)

Answer 11

Bailor, bailee

Question 12

Rights. Possession or use of a commercial store space bonds, stocks, commercial paper, loan on receivables

Answer 12

Lessor, lessee

Question 13

also a transfer of goods or services, etc.

Answer 13

Sale

Question 14

Civil Code says: “by the contract of sale one of the contracting parties obligates himself to transfer the ownership of goods or services and to deliver a determine thing and the other to pay therefore a price in money or its equivalent”

Answer 14

Article 1458

Question 15

Transfer of possession

Answer 15

Delivery

Question 16

consummated by mutual consent and the non-payment of rent on due date is certainly not intended by the lessor or owner of the rental property

Answer 16

Credit Transaction

Question 17

time allowance to pay a rental beyond the due date

Answer 17

Grace period

Question 18

An approach, where a credit and collection manager reacts to problems as they occur, oftentimes applying “band-aid” solutions, is not suggested.

Answer 18

System approach

Question 19

When a transaction is consummated and all parties are satisfied, there is no reason to be concerned. But since a transaction could turn sour, or pose a problem, or even create a legal dispute.

Answer 19

Reasons for concern

Question 20

managers and employees respond to problems as they arise on…

Answer 20

Touch and go basis

Question 21

should be capable of being handled with ease by the employees

Answer 21

Credit and collection system

Question 22

Essentials of credit (3)

Answer 22

Amount
Promise to pay
Determinable future date