Companies generally create liabilities that exceed assets by:
A)borrowing money they cannot repay.
B)issuing additional stock.
C)losing a lawsuit.
D)a and c

Question

Quizplus · Accepted Answer

Option A represents a situation where companies take on debt that they cannot repay, which increases their liabilities. Option C refers to a situation where companies lose a lawsuit and are required to pay a settlement to the other party, which also increases their liabilities. Therefore, both options A and C contribute to companies creating liabilities that exceed their assets.

Companies Generally Create Liabilities That Exceed Assets By