BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Answer: The amount of interest is credited by the buyer to Financial Accounting .

Detailed explanation-2: -Hire-Purchase Price: It is the total amount which the hirer is required to pay to the hire vendor under the hire-purchase contract. As this amount also includes interest (also called finance charges), it is always more than cash price of the goods. Thus, Hire-purchase Price = Cash Price + Interest Charged.

Detailed explanation-3: -Under the Hire Purchase System the Hire Purchaser gets possession of the goods at the outset and can use it, while paying for it in instalments over a specified period of time as per the agreement. However, the ownership of the goods remains with the Hire Vendor until the hire purchaser has paid all the instalments.

Detailed explanation-4: -The total amount payable by the hire purchaser to the hire seller, called the hire purchase price, is always more than the cash price of the goods purchased. The difference between the hire purchase price and the cash price of the goods is the interest on the delayed payment in form of instalments.