Long-term debt imposes financing risk because it

a. decreases the need for shareholders' equity.
b. requires principal and interest payments.
c. requires a default before filing for bankruptcy.
d. can result in default, creditor or regulatory intervention in the management of the firm.
e. None of these answer choices is correct.


B

Business

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Communication with our __________ can help identify issues within the work environment which can be fixed.

A. top managers B. employees C. union D. recruits E. board

Business

Carns Company is considering eliminating its small tools division, which reported an operating loss for the recent year of $85,000. Division sales for the year were $1,310,000 and its variable costs were $1,175,000. The fixed costs of the division were $220,000. If the kitchen division is dropped, 45% of the fixed costs allocated it could be eliminated. The impact on Carns's operating income from eliminating the small tools division would be:

A. $74,200 decrease B. $220,000 decrease C. $99,000 decrease D. $36,000 increase E. $36,000 decrease

Business

A company has an investment in 9% bonds with a par value of $100,000 that pay interest on October 1 and April 1. The amount of interest accrued on December 31 (the company's year-end) would be:

A. $2,250. B. $750. C. $1,500. D. $4,500. E. $9,000.

Business

In a contract for a sale of goods, the usual measure of compensatory damages is the difference between the retail price and the wholesale price

Indicate whether the statement is true or false

Business