Which of the Following Statements Is False

question 38

Multiple Choice

Which of the following statements is false?

• A)Creditors do not have voting power.
• B)Payment on interest on debt in considered an expense, while payment of dividends is a return on capital.
• C)Unpaid debt is a liability of the firm, and if not paid, can result in liquidation of the firm.Unpaid common stock dividends cannot force liquidation.
• D)One of the costs of issuing equity is the possibility of financial distress, while no financial distress is associated with debt.
• E)None of the above.

Identify internal and external users of accounting information and their needs.

Compare and contrast International Financial Reporting Standards (IFRS) with Generally Accepted Accounting Principles (GAAP).

Understand the roles and objectives of financial auditing.

Recognize the need for and challenges of international accounting standards.

---

Definitions:

Decreasing

A process or trend involving reduction in size, number, value, or intensity over time.

Total Bond Energy

The sum of all bond energies in a molecule, representing the energy needed to break all bonds in a molecule into separate atoms.

Potential Energy

is the energy stored within an object or system due to its position, condition, or configuration, capable of being converted into kinetic energy.

Enthalpy

The total potential energy of a system; sometimes referred to as the “heat content of the system.”