Jonathan Baird, the founder of Water boots Inc., needs to raise $500,000 to expand his company's operations.

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Jonathan Baird, the founder of Water boots Inc., needs to raise $500,000 to expand his company's operations. He has been told that raising the money through debt by obtaining a bank loan will increase the riskiness of his company much more than by raising the money by issuing common shares. He doesn't understand why this is true. Explain it to him.

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Financial Accounting Tools for Business Decision Making

ISBN: 978-1119368458

7th Canadian edition

Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine

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