Which of the Following Is the Best Reason for the Issuance

question 82

Multiple Choice

Which of the following is the best reason for the issuance of long-term liabilities?

• A)Debt financing offers an income tax advantage.
• B)Risk to the firm may be increased.
• C)Ownership interest is diluted but may be necessary to do.
• D)Debt financing may cost the entity more but is the only available source of funds.

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Definitions:

Marriage Gradient

The sociological pattern in which men tend to marry women who are slightly below them in age, education, or social standing.

Socialized

Refers to behavior that is modified or learned based on social interactions and norms.

Societal Bias

The pervasive and systematic leaning or prejudice in a society that favors certain groups or ideas over others.

Hooking Up

A term often used to describe a range of intimate activities, from kissing to sexual intercourse, that occur without the expectation of a committed relationship.