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If you borrowed $5,000 for four years, that would be a _________________. short-term loan long-term loan critical loan interest-based loan

Rodney Fox

in Business

1 answer

1 answer

Deborah Edwards on April 14, 2018

Correct option: Long-term loanIn finance, short-term refers to a period of less than one year, or 365 days, while long-term is a period longer than one year, or 365 days. Here the borrower loan of $5000 for a period of four years, which is older than 365 days. This is why it is a long-term loan. In the balance sheet, this loan must be reflected under long-term liabilities.

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