Question: What is the basic reason why debt financing affects the income available to asset funders? Interest is excluded from the income available to asset funders.
What is the basic reason why debt financing affects the income available to asset funders?
Interest is excluded from the income available to asset funders.
Interest is a taxdeductible expense.
Taxes increase when debt financing replaces equity financing.
Shareholders are asset funders but creditors are not.
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