Which of the Following Is Unlikely to Influence a Firm's

question 91

Multiple Choice

Which of the following is unlikely to influence a firm's choice of capital structure?

• A)Taxes
• B)Agency costs and benefits of leverage
• C)Transaction costs
• D)All of the above influence capital structure decisions.

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Definitions:

Itemized Deductions

Expenses that taxpayers can subtract from their gross income to reduce the taxable income, including payments like mortgage interest, state taxes, and charitable contributions, as specified by the IRS.

Forfeit

The loss of any right, privilege, or property because of a breach of obligation or failure to meet a requirement.

Mileage Reimbursement

Compensation for fuel and wear-and-tear expenses for the use of a personal vehicle for business purposes, usually calculated by the mile.

Schedule C

A tax form used by sole proprietors to report income and expenses from a business.