Question: Kern's Kernel Corporation needs to raise $ 3 0 0 , 0 0 0 of additional capital to purchase a grain silo. The corporation could

Kern's Kernel Corporation needs to raise $300,000 of additional capital to purchase a grain silo. The
corporation could borrow $300,000 from a local bank or it could issue additional shares of common stock to
a handful of additional investors in exchange for $300,000.
Jen, the company's CFO, is considering relative advantages and disadvantages of both options. She
concluded that one option could be more risky than the other because
payments to a
lender are
whereas the payment of
to stockholders is
.
Prompts
debt
dividends
Answers
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 Kern's Kernel Corporation needs to raise $300,000 of additional capital to

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