The Balance Sheet of BYA Corporation Reported Bonds Payable with a Book

question 50

Multiple Choice

The balance sheet of BYA Corporation reported bonds payable with a book value of $500,000 and total paid-in capital of $300,000. The balance sheet of LCA Corporation reported bonds payable with a book value of $600,000 and total paid-in capital of $250,000. Which of the following statements is most true?

• A)BYA's exposure to liquidity risk is greater than LCA's exposure.
• B)BYA's exposure to liquidity risk is less than LCA's exposure.
• C)BYA and LCA have equal exposure to liquidity risk.
• D)None of the above statements is true.

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Definitions:

Inequalities

The condition of lacking equality, particularly in terms of status, rights, and chances.

Dominant Response

The most likely reaction or behavior to occur in a given situation, often under conditions of stress or high arousal.

Fierce Resolve

Strong determination or unwavering firmness in pursuing a goal or overcoming challenges.

Narcissism

A personality trait characterized by an inflated sense of self-importance, a deep need for admiration, and a lack of empathy for others.