Corporations in the U.S.tend To

question 52

Multiple Choice

Corporations in the U.S.tend to:

• A)have extremely high debt-to-equity ratios.
• B)rely less on equity financing than they should.
• C)minimize taxes.
• D)underutilize debt.
• E)rely more heavily on bonds than stocks as the major source of financing.

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Definitions:

Consolidation Adjusting Entries

Adjustments made in accounting records to remove the effects of intercompany transactions during the consolidation process for a group’s financial reporting.

Accounting Periods

Defined time frames in which financial transactions are recorded and financial statements are prepared.

Consolidation Worksheet

A tool used in preparing consolidated financial statements that details the financial activities of a parent company and its subsidiaries.

General Ledger

A comprehensive record of a company's financial transactions over the duration of its life, providing the foundation for its financial statements.