I understand you have projected if the company grows fast enough to need new external financing they
Question:
“I understand you have projected if the company grows fast enough to need new external financing they will borrow additional funds and sell new shares. If DG borrows money or sells stock, the bondholders and shareholders are the source of funds and I get that. I noticed, however, that you included accrued payroll as a source of funds the company used in the past to fund their existing assets.”
Choose one of the following as most likely to be true.
A. the source of funds from accrued payroll is employees
B. the source of funds from accrued payroll is short-term debt (commercial paper)
C. the source of funds from accrued payroll is retired employees who draw a pension
D. the source of funds from accrued payroll is shareholders
Foundations of Financial Management
ISBN: 978-1259024979
10th Canadian edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta