Why is debt usually the cheapest finance source?
Question:
Why is debt usually the cheapest finance source?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (1 review)
Debt is often considered the cheapest source of financing for several reasons 1 Tax Deductibility Interest payments on debt are typically taxdeductibl...View the full answer
Answered By
GERALD KAMAU
non-plagiarism work, timely work and A++ work
4.40+
6+ Reviews
11+ Question Solved
Related Book For
Principles Of Managerial Finance
ISBN: 9781292400648
16th Global Edition
Authors: Chad Zutter, Scott Smart
Question Posted:
Students also viewed these Business questions
-
List three specific parts of the Case Guide, Objectives and Strategy Section (See below) that you had the most difficulty understanding. Describe your current understanding of these parts. Provide...
-
On November 5, 2003, Eli Colby was looking over his companys financial statements for the year ending October 31, 2003. Belle Air Charter, a small airline charter service company based in Vancouver,...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
How could not having a strategy hurt a brand on social media? What are some content ideas for those who are at the "Awareness" stage of the sales funnel? What does it mean to A/B test on a social...
-
Waterbahn Waterslide Company issued 25,000, 10-year, 6 percent, $100 bonds on January 1, 2014, at face value. Interest is payable each December 31. Show the accounting equation effects and prepare...
-
Nazari Electrical Services has an August 31 fiscal year end. The company?s trial balance prior to adjustments follows: Additional information: 1. The equipment has an expected useful life of 12...
-
The following actual statement of financial position was prepared for Martins Musical Supplies Ltd as at 30 September 2025. 1. Sales forecasts available: October $39000, November $44 000, December...
-
Seger, Inc., is an unlevered firm with expected annual earnings before taxes of $21 million in perpetuity. The current required return on the firms equity is 16 percent, and the firm distributes all...
-
A. Calculate the cross-arc elasticity in the following situation. (mathematical method) Price X Amount Y $10 70 $13 100 Based on the above result, consumer response regarding products can be...
-
What are the conditions under which the WACC is an appropriate hurdle rate for a firms investments?
-
Find some recent projections for the future path of the U.S. government debt as a percentage of GDP. What assumptions are made about government spending, taxes, and economic growth? Do you think...
-
Summary financial information for Wolford Company is as follows. Compute the amount and percentage changes in 2017 using horizontal analysis, assuming 2016 is the base year. December 31, 2017...
-
The sociologist Arlie Hochschild distinguishes between emotional labor and emotional work. How do they differ? Using yourself as an example, discuss how both figure at your current or a past...
-
What does The British north America act of 1867 contains?
-
Sheridan Manufacturing purchased a new building with the surrounding land. The price paid was $2,400,000, including the commission charged on the sale. An appraisal of the land and building at the...
-
a. The U.S. dollar derives its value from what? That is, what "backs" U.S. currency? b. What is the term used to describe the type of money used in the United States today? c. What two other types of...
-
The fact remains that it is cost-effective and efficient for firms to source their supply chains from across the globe. This phenomenon is known as?
-
Gomez Products Co. has two departments: Mixing and Cooking. At the beginning of the month, Cooking had 4,000 units in process with costs of $8,600 from Mixing, and its own departmental costs of $500...
-
What services are provided by the provincial and territorial governments?
-
On January 1, 2019, Belle Florist opened a store in an upmarket area of Soho, London. The business is owned by Boris Kimmel, the sole proprietor. During the year, Boris has kept a record of all...
-
Geotherm Energy Ltd. has a net profit margin of 6%, a financial leverage multiplier of 1.5, and a total asset turnover of 1.2. What is the ROE? What is the advantage of using the DuPont system to...
-
Crane Housing PLC has a current ratio of 2.5 and total current assets worth 5 million. Crane housing also has some long-term borrowings where the bank has stipulated that the current ratio of the...
-
What are the legal consequences of using corporate assets for personal use? Back it with primary sources like the internal revenue code, internal revenue manual, treasury regulations.
-
Barnes Corp. issues $ 8 0 0 , 0 0 0 of 9 % , 2 0 - year bonds. The bonds are dated January 1 , 2 0 1 1 , and are due in 2 0 years on January 1 , 2 0 3 1 . Interest is paid semi - annually each June 3...
-
Magic Mountain retires its 9% bonds for $128,000 before their scheduled maturity. At the time, the bonds have a face value of 126,000 and a carrying value of $117,000. Record the early retirement of...
Study smarter with the SolutionInn App