Final answer:
The assertion that interest expense, utilities expense, or loss on plant assets would all be found under Other Expenses is false; interest expense is usually listed separately. Positive net worth indicates a healthy business, while negative net worth signals financial distress. Loan valuations in the secondary market are influenced by payment history, economic interest rates, and borrower profitability.
Step-by-step explanation:
The statement that 'All of the following accounts would appear in the Other Expenses section of an income statement except interest expense, utilities expense, or loss on plant assets' is false. Typically, on an income statement, interest expense is listed separately from other expenses because it is associated with the cost of borrowing and not with primary operations. In contrast, utilities expense and loss on plant assets would indeed be listed under Other Expenses, as they relate to the operational costs and losses from asset disposition that are not core to the business operations.
A healthy business's net worth is calculated by subtracting total liabilities from total assets, often represented in a T-account. If a firm has positive net worth, it signifies financial health, while a negative net worth indicates potential bankruptcy.
When assessing loans in the secondary market, a financial institution would consider various factors such as the borrower's payment history, current economic interest rates, and the borrower's profitability. The price the institution is willing to pay would be adjusted based on these assessments, to ensure potential returns justify the risk involved.