An advantage of issuing bonds payable to finance a plant expansion (rather than common stock) is that:

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bond interest is tax deductible. earnings per share may be higher.

common shareholders retain their same percentage of ownership without purchasing more stock.

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Accounting Principles

ISBN: 978-0470533475

9th Edition

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

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Posted Date: Feb 13, 2024 12:06 AM

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An advantage of issuing bonds payable to finance a plant expansion (rather than common stock) is that:

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Accounting Principles

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