If the Tax Laws Were Changed So That $0

question 57

True/False

If the tax laws were changed so that $0.50 out of every $1.00 of interest paid by a corporation was allowed as a tax-deductible expense,companies would be encouraged to use more debt financing than they presently do,other things held constant.

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Definitions:

Record Payment

The process of documenting the payment of a bill or an obligation in the business’s financial records.

Revenue Journal

The revenue journal is a ledger book or digital record in accounting that tracks all incoming earnings or revenue transactions generated by business operations.

Cash Receipts Journal

A specific accounting journal used to record all receipts of cash during a particular period.

Sale On Account

A transaction where goods are sold and payment is deferred to a later date, creating an account receivable for the seller.