Multiple Choice
Which of the following is not an accurate statement regarding the distinction between debt and equity?
A) Only equity is considered a source of financing for operations of the business,since debt must be repaid at a specified maturity date.
B) If a business ceases operations and liquidates,claims of all creditors have legal priority over claims of the stockholders.
C) Most debt requires the borrower to pay interest;equity financing does not obligate the company to make a specified payment.
D) The providers of equity are owners of the business;the providers of borrowed funds are creditors.
Correct Answer:

Verified
Correct Answer:
Verified
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