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15.1 Bonds Payable Your Answer Correct Answer X Your answer is incorrect. All of the following are advantages of issuing bonds instead of common shares EXCEPT tax savings result. earnings per share on common shares may be lower. bonds may raise more funds. shareholder control is not affected. Solution Issuing bonds is an easier way of raising funds. It increases earnings per share and also produces a higher return on equity for the shareholders. The interest paid on bonds is tax deductible and bondholders do not have any ownership in the company.
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