All of the Following Are Advantages of Issuing Bonds Rather

question 25

Multiple Choice

All of the following are advantages of issuing bonds rather than stock except

• A)financial leverage.
• B)payment of bond interest is not required
• C)bond interest is tax-deductible.
• D)bondholders do not have voting rights.

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Definitions:

Net Income

The total profit of a company after all expenses, including taxes and operating costs, have been subtracted from total revenue.

Derivative

A financial instrument whose value is based on the performance of underlying assets such as stocks, bonds, or commodities.

Derivative

A financial instrument whose value is based on or derived from one or more underlying assets.

Asset Account

An account on a company's balance sheet that represents a resource with economic value owned or controlled as a result of past transactions.