| A | B |
|---|
| debt financing | obtaing capital by borrowing money for a period of time. |
| promissory notes | a written and signed promise to pay a sum of money at a specified time. |
| notes payable | promissory notes signed by a business and given to a creditor. |
| date of a note | the day a note is issued. |
| principal | The original amount of a note. |
| maturity date | The date on which the principal of a note is due to be repaid. |
| interest | an amount paid for the use of money for a period of time. |
| interest rate | the percentage of the princpal that is due for the use of the funds secured by a note. |
| current liabilities | liabilities that are due within a short time, usually a year. |
| interest expense | interest accrued on borrowed funds. |
| maturity value | The amount that is due on the maturity date of a note. |
| interest-bearing notes | A note having stated interest rate. |
| noninterest-bearing notes | a note that deducts interest from the face value of the note. |
| line of credit | a bank loan agreement that provides immediate short-term access to cash. |
| prime interest rate | The interest rate charged to a bank's most creditworthy customers. |
| prepaid expense | cash paid for an expense in one fiscal period that is not used until a later period. |
| reversing entry | an entry made at the beginning of one fiscal period to reverse an adjusting entry made in the previous fiscal period. |
| accrued expenses | Expenses incurred in one fiscal period, but not paid until a later fiscal period. |
