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It is usually easier for a C corporation to obtain debt hnancing compared to businesses organized in alternative legal forms because: aC corporation can issue stock OaC corporation has a board of advisors who act as fiduciaries for the corporation's lenders O due to securities regulations, tax concerns, and their own legal form of business organization, many investors can or will invest only in C corporations. O lenders get to choose to whom they want to make a loan and, as a result, business credit is often reserved for larger, more sophisticated businesses that have a formal legal structure in place, like a corporation

It is usually easier for a C corporation to obtain debt hnancing compared to businesses organized in alternative legal forms because: aC corporation can issue stock OaC corporation has a board of advisors who act as fiduciaries for the corporation's lenders O due to securities regulations, tax concerns, and their own legal form of business organization, many investors can or will invest only in C corporations. O lenders get to choose to whom they want to make a loan and, as a result, business credit is often reserved for larger, more sophisticated businesses that have a formal legal structure in place, like a corporation

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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It is usually easier for a C corporation to obtain debt financing compared to businesses organized in alternative legal forms because: a C corporation can issue stock O a C corporation has a board of advisors who act as fiduciaries for the corporation's lenders O due to securities regulations, tax concerns, and their own legal form of business organization, many investors can or will invest only in C corporations. O lenders get to choose to whom they want to make a loan and, as a result, business credit is often reserved for larger, more sophisticated businesses that have a formal legal structure in place, like a corporation
Transcribed Image Text:It is usually easier for a C corporation to obtain debt financing compared to businesses organized in alternative legal forms because: a C corporation can issue stock O a C corporation has a board of advisors who act as fiduciaries for the corporation's lenders O due to securities regulations, tax concerns, and their own legal form of business organization, many investors can or will invest only in C corporations. O lenders get to choose to whom they want to make a loan and, as a result, business credit is often reserved for larger, more sophisticated businesses that have a formal legal structure in place, like a corporation
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