Book Values Are Sometimes Used to Calculate the Percentage of Debt

question 47

True/False

Book values are sometimes used to calculate the percentage of debt in a firm's capital structure because much corporate debt is infrequently traded and market prices cannot be obtained.

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Definitions:

Convicted

Found guilty of a crime following a trial or through a guilty plea in a court of law.

Felony

A serious crime, typically one involving violence, regarded more severely than a misdemeanor, and usually punishable by imprisonment for more than one year or by death.

Misdemeanor

A criminal offense that is less severe than a felony, typically punishable by fines or incarceration for less than one year.

Petty Offense

A minor crime that is less serious than a misdemeanor, often punishable by a fine or a short term of imprisonment.