How does the deductibility of interest and dividends by the paying corporation affect thechoice of financing (i.e., the use of debt versus equity)?

Q: How can I tell if a company is financed by debt or equity?

A: here you need to know what is debt and equity debt means you're borrowing money from an outside…

Q: The cash interest payment a corporation makes to its bondholders is based on

A: Bonds: Bonds are defined as debt instruments which are usually issued by the company that borrows to…

Q: In evaluating the cost of debt where a company has several issues       outstanding should the…

A: No, while calculating the cost of borrowing when companies have several obligations outstanding we…

Q: What is advantage of using bonds for financing instead of obtaining financing from the company's…

A: Debt financing is the process by which the business raises funds by offering the debt instruments.…

Q: IFRS requires companies to measure their financial assets at fair value except when based on:(a)…

A: International Financial Reporting Standards:   IFRS (International Financial Reporting Standards) is…

Q: What type of financial institutions may offer the services for reception and transmission of orders…

A: Order receipt and transmission refer to receiving a purchase or sale order from a customer and…

Q: How are the activities of Debt Service Funds controlled?

A: Debt service fund: Debt service fund is the fund created to ensure no delay or failure in the…

Q: The sale of stock and the sale of bonds are reported as financing activities. Are payments of…

A: Statement of cash flows: This statement reports all the cash transactions which are responsible for…

Q: Distinguish between public and private corporate debt.

A: Debt is the amount of loan that is borrowed and it is repaid along with the interest.

Q: What is Debt financing? What are the major sources of corporate financing?

A: Corporate finance is the domain of finance concerned with how companies cope with financing sources,…

Q: To what extent a company uses debt financing (or financial leverage) in business operations?

A: The question is based on the concept of capital structure of a company, the capital structure is a…

Q: What is off-balance-sheet financing? Why might a companybe interested in using off-balance-sheet…

A:

Q: For fi nancial assets classifi ed as trading securities, how are unrealized gains and losses refl…

A: Trading securities are debt or equity assets that management expects to aggressively sell for gain…

Q: How company  take tax advantage of Bonds Payable

A: A bond is a financial instrument which is issued by an entity with the intention to re-pay the…

Q: How would you describe a change that a company makes from the equity method to the fair-value method…

A: Definition:   Equity method: Equity method is the method used for accounting equity investments…

Q: Debt securities acquired by a corporation which are accounted for by recognizing unrealized holding…

A: Solution: Debt securities acquired by a corporation which are accounted for by recognizing…

Q: How can we summarize the firm's ability to meet debt repayment obligations?

A: Debt repayment obligations: It means the repayment obligation for the debt held by the corporation.…

Q: Explain the advantages and disadvantages of the use of debt to a company

A: Debt - Debt is a source of fund to a company on which company pay an annual fixed payment. and that…

Q: For a corporation, what are theadvantages of corporate bondsover long-term loans?

A: Bonds are a type of debt which is issued by the company  or the government. It is long term debt on…

Q: How a company takes tax advantage of Bonds Payable (or any other fixed cost financing)?

A: Giving securities is one path for organizations to fund-raise. A bond capacities as a credit between…

Q: What is one of the primary concerns of financial analysis regarding a firm's debt payments?

A: A firm's debt payment ability is one of the main concerns for the suppliers of the business, to the…

Q: Why are liability accounts included in the capital acquisitionand repayment cycle audited…

A: Liability accounts in the capital acquisition and repayment cycle are audited differently from…

Q: creditors assess risk when lending funds

A: Assessment of risks when lending funds means evaluating the credit worthiness of the company in…

Q: Ownership of debt instruments of the government and other companies that can be readily converted to…

A: Cash and its equivalents are the current assets available with the entity that are either in the…

Q: The most important non-cash item is a) Debt interest rate b) Income tax c) Dividend d) Depreciation

A: Answer

Q: what are major categories of debt and stock for a corporation.

A: Several businesses and people employ debt to finance major purchases that they would not be able to…

Q: Why dividends are not deductible?And what could be the order of priority regarding income and assets…

A: Dividends: It refers to the that part of the profit that is given to common shareholders. It is…

Q: 7.) Describe the debt and equity markets? How do organizations obtain financing from each market?…

A: Debt is considered riskless, however equity securities have some inherent risk.

Q: investments in debt instruments are financial asset

A: First option is wrong because debt instruments are not equity instruments. Second option is wrong…

Q: A corporation that uses debt concentrates the risks of the business on the ___________.

A: Answer

Q: Why do we use an after-tax figure for cost of debt but not for cost of equity?

A: Cost of debt is the interest payments a company needs to make for debt financing, whereas cost of…

Q: What is the advantage of issuing bonds instead of obtaining financing from the company’s owners?

A:

Q: Are the companies financed primarily with debt or equity? Why?

A: The financing method of companies can be evaluated using debt equity ratio. If the debt equity ratio…

Q: Can corporation use the Cash method of accounting? Explain.

A: Payment receipts are typically recognized during the timeframe in which they have been obtained, and…

Q: state advantages and disadvantages of debt and common equity

A: Financing activities include raising funds from various sources for business operation and managing…

Q: How any company is taking tax advantage of bonds payable or any other fixed cost financing?

A: Bond can be considered as an I.O.U between the lender and the borrower that contains details about…

Q: How does a corporations debt differ from its equit

A: Following are the differences between corporation debt and its equity: Debt is the fund borrowed…