Aardvark is considering issuing corporate bonds in order to raise money.Which of the following,if true,would strengthen the case for doing this?
A) The company's customer base has been declining.
B) The company has debts that need to be paid immediately.
C) The company's main interest is in long-term solvency.
D) The company is interested in cutting costs.
E) The company's assets are rapidly depreciating.

Question

Quizplus · Accepted Answer

B)Selling bonds would result in an immediate inflow of cash that could be used to pay short-term debts. Choices A, D, and E:these do not relate to the choice of issuing corporate bonds. Choice C suggests that the company should pursue some financial option that will pay dividends over the long term.

Aardvark Is Considering Issuing Corporate Bonds in Order to Raise