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JAMB Commerce 2000 Question 9

Question 9

Business Finance

Bank overdraft as a short term source of fund is

  1. A.an overdrawn account
  2. B.granted to a newly opened account
  3. C.repayable after more than a year
  4. D.a current liability.
Show the answer and explanation

Answer: D (a current liability.)

Explanation

An overdraft is repayable on demand, so it is shown as a current liability.