Monday, October 26, 2009

Finance Help...Additional Source of Equity for a Company?

Which of the following sources of funds can be used as additional sources of equity capital for a company?



1) Dividend Reinvestment



2) Bank Loan



3) Bond Issue



4) Private Placement



5) Rights Issue



Finance Help...Additional Source of Equity for a Company?

4. A private placement is selling unregistered equity interest to a limited number of shareholders. The funds received for the shares directly increase the equity of the firm.



Finance Help...Additional Source of Equity for a Company?

None of the above are equity sources for a companies equity.



Companies do in reinvest dividends, investors do.



Bank loan is debt



Bonds are debt



4 and 5 have nothing to do with equity or debt.



Sales, Revenue are equity builders, as are...



Capitol Equipment



Mergers and Aquisitions



Issuances of more stock



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