eates additional expense without enough benefit through codt savings, income or capital gain, them it is not worth it True or fal
eates additional expense without enough benefit through codt savings, income or capital gain, them it is not worth it True or fal
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
If debt creates additional expense without enough benefit through codt savings, income or capital gain , them it is not worth it
True or false?
Expert Solution
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Step 1
Companies use debt in the capital structure because interest on debt is tax deductible and reduces cost of capital.
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