What is the most obvious difference between debt and equity financing? a. Principal and interest must be repaid for debt financing. b. Dividend payments are mandatory. c. Debt financing can result in loss of control. d. Equity financing is revenue and thus taxable.

What is the most obvious difference between debt and equity financing? a. Principal and interest must be repaid for debt financing. b. Dividend payments are mandatory. c. Debt financing can result in loss of control. d. Equity financing is revenue and thus taxable.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter7: Losses—deductions And Limitations

Section: Chapter Questions

Problem 6DQ

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Question

What is the most obvious difference between debt and equity financing?
a. Principal and interest must be repaid for debt financing.
b. Dividend payments are mandatory.
c. Debt financing can result in loss of control.
d. Equity financing is revenue and thus taxable.

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