561FinanceMedium
Which of the following statement is TRUE regarding debt?
AUnpaid debt can result in bankruptcy or financial failure.
BDebt is an ownership interest in the firm.
CDebt provides the voting rights to the bondholders.
DCorporation’s payment of interest on debt is fully taxable.
Correct answer
A. Unpaid debt can result in bankruptcy or financial failure.
Explanation
Unpaid debt can result in bankruptcy or financial failure. is the correct answer. Review the question and compare it with the other choices to remember this fact for future exams.