COST ACCOUNTING
FINANCIAL TERMINOLOGY
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Debtors
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Creditors
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Investors
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Customers
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Share Holders
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Detailed explanation-1: -A creditor is a party (for example, person, organisation, company, or government) that has a claim on the services of a second party. It is a person or instruction to whom money is owed. A creditor may be a bank, supplier, or person that has provided credit to a company. Was this answer helpful?
Detailed explanation-2: -A debtor is a person or organisation that owes money. This will often be owed for services or goods, or because they have borrowed money. In most instances, the debtor will have a legal obligation to pay the debt. The person they owe the money to is known as a creditor.
Detailed explanation-3: -A creditor is an individual or institution that extends credit to another party to borrow money usually by a loan agreement or contract. Creditors such as banks can repossess collateral like homes and cars on secured loans, and take debtors to court over unsecured debts.
Detailed explanation-4: -The difference between a debtor and a creditor is that the creditor is the one who lends money in a credit relationship, and the debtor is the one who borrows it.