An example of debt financing for any form of business organization is
A)borrowing from a bank.
B)issuing new stock.
C)using undistributed profits.
D)buying back bonds.
E)buying back previously issued stock.

Question

Quizplus · Accepted Answer

Debt financing involves borrowing money that will need to be repaid with interest. A common form of debt financing is borrowing from a bank, which can provide a business with a loan or line of credit. Issuing new stock and buying back previously issued stock are examples of equity financing, which involves selling ownership in the company. Using undistributed profits and buying back bonds are not examples of debt financing.

An Example of Debt Financing for Any Form of Business