If the cost of debt is the lowest choice among financing options, would increasing our percentage of debt always reduce our cost
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Answer:
attached answer
Explanation:
equity represnet investment from owners and the accumulation of the result from the company operations.
1) equity increase the company receive an investment from owner
3-6-8) equity decrease as an expense is incurred which is a negative operation it has a negative impact on the earnings of the firm
4-5-9) the company's equity increase as income is generated from the main activity.
2-7)there is no involment of equity as the company acquired an asset and takes a liability while then, at payment an asset(cash) decrease an a liability( A/P) also decrease
We must remember that we work with accrual accounting thus, the day of collection or payment are not what determinates ncome and expenses.
Answer:
Answer sheet required more space then was available so I attached it as a picture.
