Question.3948 - Chapter nine covers long-term debt and chapter 10 covers stock. When companies raise money by borrowing money, we refer to this as debt financing and when companies raise money by issuing stock, we refer to this as equity financing. Why do investors and analyst generally view debt financing as more risky than equity financing? Give specific examples of characteristics associated with each type of financing.
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Debt xxxxxxxxx or xxxxxxxxx money xx riskier xxxxx a xxxxxxxx must xxxxx the xxxx and xxx interest xx a xxxxxxx basis xxxxxxxxxx of xxx earnings xxx instance xxxxx payments xxx become x significant xxxxxx and xxx result xx bankruptcy xx business xxxxx down xxxxxxx since xxxxxxxxx are xxxxxxxxx and xxxxx on xxxxxxxxxxxxx selling xxxxxx sometimes xxxxxxxx to xx equity xxxxxxx allows xxxxxxxxxx more xxxxxx and xxxx not xxxxxx repayment xxxxxx Selling xxxxxx however xxxxxxxx giving xx a xxxxxxx of xxx business xxx owners xxxxxx the xxxx of xxxx making xxxxx if xxx stock xxxxxxxxxxx in xxxxx or xx dividends xxx distributed xxxx ReferencesVipond x January xxxx Debt xx Equity xxxxxxxxx Corporate xxxxxxx Institute xxxx nbsp xxxxx corporatefinanceinstitute xxx resources xxxxxxxxxxxxxxxxxx debt-vs-equity xxxxMore Articles From Accounting
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