All of the Following Are Advantages of Issuing Stock except

question 6

Multiple Choice

All of the following are advantages of issuing stock except:

• A) generally results in a higher earnings per share
• B) creates no interest expense which must be paid
• C) creates no liabilities for the corporation
• D) less risky to the issuing corporation

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Definitions:

Permanent Accounts

The balance sheet accounts that carry their ending balances into the next accounting period.

Accounting Period

A specific time period at the end of which an organization prepares financial statements.

Balance Sheet Accounts

Accounts that make up the financial statement showing a company's assets, liabilities, and equity at a specific point in time.

Statement of Stockholders' Equity

A financial document that shows changes in the value of a company's equity over a period, including shares issued, dividends, and earnings.