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Which of the following items would equal zero in the claims' section of the balance sheet of a company abiding by Islamic Finance rules?

Please choose only one answer:

A. Accounts Payable

B. Long-Term Loans

C. Owners' Equity Paid-in Capital

D. Notes Payable

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Question added by Nuridin Islam Diab , Training Manager , Bbusinesss LLE
Date Posted: 2016/04/28
Nuridin Islam Diab
by Nuridin Islam Diab , Training Manager , Bbusinesss LLE

The answer is B - Long term loans. Typically all conventional banks providing corporate loans charge interest for the repayment of those loans which is a Riba-based lending. Riba-based lending is not allowed in Islam. 

 

Accounts Payable are the money the company owes it's suppliers and vendors for goods / services it received from them but hasn't paid their fees yet. Those are compliant with Islamic Finance rules. Accounts Payable are usually due in 12 months or less. 

 

Notes Payable are similar to Accounts Payable in concept but they are more than 12 months. They are long term debt to the company's vendors and suppliers. 

 

The Owners' Equity Paid-in Capital is the money provided by the owners of the company as either seed capital or expansion capital. This is the most likely form of financing for start-up capital for a company which is Shari^ah compliant. 

HASSAN AHMED
by HASSAN AHMED , Internal Auditor , TIE

Thanks for the invitation Mr. Nuridin, I agree with your answer, Long term loan because of Riba based lending.

Mohamed Helal
by Mohamed Helal , Project Manager , GROUP CONSULT INTERNATIONAL

Agree with your illustrated answer Mr. Nuridin

Ahmed Mohamed
by Ahmed Mohamed , head of human resources , Abdul Rahman AL-Bader Sons CO

Thank you for inviting me to answer your question

I leave the answer to the specialists Distinguished

And good luck

I apologize for the answer, I leave the answer to experts specialists in this field that's not my specialty field

Yahia mohamed  Amen Gad
by Yahia mohamed Amen Gad , إدارة - مدرب - , سنابل الأجيال للتعليم والتدريب

Thank you for the invitation was a professor Noureddine said, and I agree with him

Omar Saad Ibrahem Alhamadani
by Omar Saad Ibrahem Alhamadani , Snr. HR & Finance Officer , Sarri Zawetta Company

Thanks

Fully agree with your answer dear

مها شرف
by مها شرف , معلمة لغة عربية , وزارة التربية السورية

I agree with Mr Nuridin answers, thanks for the invitation. .

Aslam Kanowah
by Aslam Kanowah , Executive Director , AfrAsia Bank

long term loans as it carries interest which is prohibited in Islam.

حسين محمد ياسين
by حسين محمد ياسين , Finance Manager , مؤسسة عبد الماجد محمد العمر للمقاولات العامة

agree with answers >>>>>>>>>>>>><<<<<<<<<<<<<<>>>>>>>>>>>

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