Why Would a Corporation Issue Bonds Payable Instead of Issuing

question 175

Multiple Choice

Why would a corporation issue bonds payable instead of issuing stock?

• A) Debt is a less expensive source of capital than stock.
• B) Borrowing by issuing bonds payable carries no risk to the company.
• C) Debt affects the percentage of ownership of the corporation by the stockholders.
• D) Debt does not have to be shown on the balance sheet.

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Definitions:

Psychological Disorders

Refers to mental disorders characterized by dysfunctional patterns of behavior, thoughts, or emotions, significantly impacting daily life and functioning.

Successive Editions

Subsequent releases or versions of a publication or product, each incorporating updates or revisions from the previous edition.

Malaysia

A country located in Southeast Asia, known for its diverse culture, landscapes, and economic growth.

Amok

A culturally bound syndrome, primarily found in Malaysia, characterized by a sudden outburst of unrestrained violence or aggressive behavior.